The Business Insider published an article on February 11th entitled “What Budweiser Can Teach You About Innovation“. This was based on blog post from the Harvard Business Review entitled “Four Innovation Lessons from Anheuser-Busch“. Based upon a talk given by the global director of innovation at Anheuser-Busch Inbev, the two wrote about lessons that A-B can teach us about innovation. While the four bullet points were perfectly fine (explain strategic objectives in simple terms, have defined types of innovation strategies, have a clear but robust innovation process and draw insight from non-obvious places), the suggestion that A-B is innovative in its product development is absolute bullshit.
A movie that was recently released called Beer Wars that exposed the battles fought in the beer industry (written, produced and directed by Anat Baron, former head of Mike’s Hard Lemonade), showing that A-B is both heavy-handed and rips off ideas from some of the true greats in beer (Dogfish Head, and Yuengling, for instance). In one scene, Sam, the owner of Dogfish Head, shows a bizarre and unsubstantiated cease and desist order from A-B for Dogfish’s use of “Punkin'” in the name of one of its brews. Since when did strong-arm litigation = innovation?
The following quote from the HBR article illustrates the ridiculousness of the contrast between the big brewers and those who are truly passionate about the craft:
Its strategic objectives are to increase SOB (share of beer) and SOT (share of throat). It can achieve these objectives by getting consumers to switch to its products, consume its products in new locations, or attract new consumers.
Wait, what? They have metrics like “share of throat”, a term that entertains my inner 12-year-old? They don’t simply look at ways to deliver better beer to the customer? No, they don’t. They make boring, bland beers and acquire brands that have strength in the market and a loyal following (see how they destroyed the Rolling Rock brand, a particular insult as a former resident of Latrobe, PA). That’s not innovation, that’s a recipe for market domination that is focused on shareholder value. As a business, it’s a fantastic strategy, but it should not be confused with innovation.
I’m a homebrewer and enjoy a lot of different types of beer. I’m a fan of microbrews and strange and innovative beers. I frequent local microbreweries (East End Brewing Company is a great example of innovation in beer-making) and enjoy great beer-focused Pittsburgh establishments such as Sharp Edge, Bocktown Beer & Grill and Fat Head’s. I’ve had some pretty amazing, innovative beers from brewers who are willing to take risks. A-B isn’t remotely on this list. It’s insulting to beer drinkers to suggest that A-B is innovative. It’s not innovative — it bullies its suppliers, spends amazing amounts of money keeping a regulatory system in place that does not benefit the customer and actually reduces innovation, and pursues a strategy whereby it steals innovative ideas from the market and pushes out the competition.
HBR, you’re better than this. You’re better than to swallow the propaganda of the largest brewing company in the world. Keep talking innovation, but find the right players. In beer parlance, A-B is all foam, no beer.