GM591: Leadership and Organizational Behavior
Instructor: Dr Stephanie Johnson
Organizations and Leadership Paper

By
Bruce Hatch
(719) 761-8269
August 26, 2009

INTRODUCTION

New Belgium Brewing Company, Inc. is one of the largest regional specialty brewers in the United States, producing about a dozen distinctive beers which are distributed to fifteen states in the West. Its brands include top-seller Fat Tire Ale, Sunshine Wheat Beer, and Abbey Belgian Style Ale, as well as seasonal offerings like Biere de Mars, Transatlantique Kriek, and Two Cherry Ale (www.newbelgium.com). The environmentally-friendly firm uses wind-generated electricity as well as heat and energy derived from byproducts of the brewing process. Founders Kim Jordan and Jeff Lebesch hold controlling interest in the company, which is partly owned by their employees. The New Belgium Brewing Company (NBB) was founded in 1991 in Fort Collins, Colorado by the husband-and-wife team of Jeff Lebesch and Kim Jordan. Lebesch, an electrical engineer, had taken up the hobby of brewing beer at home a decade earlier, and had later volunteered at breweries in California to sharpen his skills. He became interested in founding his own brewery after going on a bicycle tour of Belgium, where he visited a number of breweries and acquired a special strain of yeast to bring home. Although Belgian beer was not as well known in the United States as its German and English cousins, the country had its own distinctive approach to brewing, with a long tradition akin to that of winemaking in France. Belgians were particularly fond of adding flavors, like spices or fruit, to their brews, and also produced barrel-aged beers with higher alcohol content. After working up a business plan during an Easter Sunday hike in the mountains, Lebesch and Jordan, a social worker, decided to start a brewery in the basement of their home, and took out a $60,000 second mortgage to finance the endeavor. The company's initial offerings were the flavorful Abbey Trappist Style Ale and the lighter Fat Tire Ale, which was named after the bike Lebesch, had toured Belgium on. The first bottles were capped in June 1991, and featured a neighbor's watercolor paintings on the labels. Having persuaded a few local stores to carry their beer, Jordan, who handled the marketing, delivered it in the family station wagon. During their first year, the couple turned out 3,300 cases of 22 ounce "bomber" size bottles. Lebesch's Fat Tire Ale was especially well-received, and as its popularity grew its size was switched to the more standard twelve-ounce bottles (www.newbelgium.com).
With sales climbing steadily upward, Lebesch and Jordan quit their day jobs to brew beer full time. In the fall of 1992 the company's operations were moved into a former rail freight warehouse in Fort Collins, and distribution was gradually expanded to cover much of the state of Colorado and a few outstate metropolitan areas. By 1994 NBB's annual output had grown to 28,000 31-gallon barrels, and the firm had begun offering public tours of its plant (www.newbelgium.com).
In November 1995 NBB opened a new $5 million brewery down the street from its existing location. By now the firm's beers included several additional varieties, including Old Cherry Ale, which was flavored with fresh berries. The company employed 50, with Lebesch serving as vice president and head of brewing operations, and Jordan as president and CEO.
The so-called "microbrewery" segment of the marketplace was now experiencing tremendous growth. In 1994 Colorado had less than forty breweries and brewpubs (bars or restaurants which brewed beer on the premises), but just two years later the number had increased to more than sixty. Fort Collins was a hot spot, with one brewery per 12,000 residents, more than four times the statewide average of one per 51,000. In addition to NBB and several other small breweries and brewpubs, the city was also home to a major