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INTRODUCTION
COMPANY’S HISTORY
o In 1905, Anglo-Swiss Condense Milk Company merged with Nestle
o From 1918 until now: improved products, launched new product lines, merged with other food and beverage companies.
o In the 1860s, Henry Nestle, a German pharmacist, invented a food for babies cannot be fed by breast-milk and developed infant food.
OVERVIEW
o Nestle is one of the largest food and beverage companies in the world
o Nestle commits to provide quality food and nutrition in wide range of categories
o Operations in 86 countries with over 2000 brands worldwide
PRODUCTS & SERVICES
o Baby foods – ex: nestle gấu, cereal
o Bottled water – ex: la vie
o Cerealso Chocolate and
confectionery – ex: Kitkat
o Coffee – ex: nestcafeo Culinary, chilled and
frozen foodo Dairyo Drinks
o Food services (condiments and flavor)
o Healthcare nutrition (vitamins and supplementary nutrition)
o Ice creamo Pet careo Weight management
13 main areas:
NESTLE IN VIETNAM
o Nestlé started the business in VN by first opening an office in HCM city since 1912.
o In 1992, Nestlé associated with the Vietnamese company to establish mineral water company, La-vie.
o In 1995, the first factory was built in Dong Nai.
o 10 product lines with 26 brands.
COMPETITORS
ORGANIZATION
Before looking at the Organizational Structure…
What Management is substantially used in Nestle?
Children and Family
Helping children grow into healthy adults
With Milo!
Examples
As it has…
o Calcium: for strong teeth and bones.
o Iron: to carry oxygen to the body’s cells.
o Vitamin A: for healthy eye sight .
o Vitamins B1 and B2: to help release energy from foods.
oVitamin C: to keep skin and gums in good shape.
We developed soluble coffee to help thousands of farmers avoid hardship and crop waste through a collaborative approach with the Brazilian government
Nescafé respects nature
o Responsible farming.
o Responsible production.
o Responsible consumption.
Nestle’s Core Management (Customer Value Management)
Society
Creating Value for Society as they are
shareholders
Future Generation
Protecting Future generation by
sustaining environment
Customers
Serving customers by achieving the highest levels of quality for our
products
Organizational Structure of Nestle
Chairman of the Board Peter Brabeck-Letmathe
Corporate Governance Compliance &
Corporate Services
Corporate Communications
Human Resources
Operations Chief Financial Officer
Strategic Business Units, Marketing
and Sales
Innovation Technology and
R&D
Nestle Waters
Zone EMENA: Europe, Middle
East, North Africa
Nestle Professional
ZONE AMS: Americas
Zone AOA: Asia, Oceania and
Africa
Nestle Business Excellence
Nestle Nutrition
Chief Executive Officer
Features of Nestlé’s organizational structure
o Decentralization
o Flat organizational structure
o Minimum levels of Management
o Broad spans of Control
o Sharing vision and common goals
Why has Nestle chosen the structure?
Quick Response
to changes
Strong Focus on Goals to achieve
In-company People
Development
Leveraging people’s
strength and organization
alignment
Clearing levels of responsibility
How does Nestle make decision?
More Empowerment to Employees More frequent
communication between higher-
level managers and staffers
Responsible individuals for
making decisions
Quick Response to problems/Higher
Effective Performance
MOTIVATION
Motivation
financial motivation
salary increases
profit-sharing
incentive travel
paid time-off
non-financial motivation
goal-setting communication
autonomy responsibility
flexibility
FINANCIAL MOTIVATION
salary increases profit-sharing
Example for financial motivationShort-term Incentive:
o Reward for accomplishments during a specific performance period.
o Quarterly.
o For most Staff and Division level positions.
Nestlé offers APEX, Award for Performance Excellence program.
Long-term Incentive:
o Be designed to motivate and reward over a long period.
o Often three years or more.
o For those in eligible leadership positions.
LTIP target opportunities are set to be competitive with marketplace practice and are calculated as percentage of pay.
FINANCIAL MOTIVATION
incentive travel paid time-off
Example for financial motivation
NON-FINANCIAL MOTIVATION
goal-setting communication
NON-FINANCIAL MOTIVATION
responsibility
flexibility
CONTROL PROCESS
Internal control
Tangible resources
Intangible resources
Financial resources
Organizational resources
Technological resources
Physical resources
Human resources
Innovation resources
Reputation resources
INTERNAL CONTROL
General environment analysis
External control
Industry environment analysis
Demographic
Global
Political or legal
Economic
Technological
Threat of a new entrant
Bargaining power of new supplier
Bargaining power of new buyer
Threat of substitute of products
Intensity of rivalry among competitors
EXTERNAL CONTROL
As regards its departments, these are:o Corporate Governance. Compliance & Corporate Serviceso Corporate communicationso Human Resourceso Operationso Finance and controlo Strategic Business Units, Marketing and Saleso Innovation, technology and R&D.
Furthermore, its operating segments are:o Nestlé Waters o Nestlé Nutritiono Nestlé Professional Zone Europeo Zone Asia/Oceania/Africao Zone Americas
ORGANIZATIONAL CONTROL
MANAGERIAL PRACTICES
TECHNOLOGY
Fermentation probiotic: interaction of probiotics and intestinal cell
Healthier fat: use vegetable oils in bouillon.
Foam booster technology: less fat, denser, longer-lasting foam.
Malt extraction: less sucrose & more complex carbon-hydrates.
ETHICS
o Marketing infant formula in third world countries
o In Italy, infant formula was contaminated harmful chemical (ITX)
o Violation of labor rights in many countries
EMPLOYEE EMPOWERMENT
o Involve employees in decision making process.
o Provide continual training & support.
oIncrease delegate authority & impact opportunity.
o Share leadership vision, goals & direction.
Result : Nestlé India
o Laminate waste was reduced 35%.
o Power waste was reduced 87%.
o Operation stoppage was reduced 25%.
o Line performance was increased 8%.
DIVERSITY
o Around 330,000 employees, 130 countries
o Differences are appreciated
o Nestle Black Employee Association, Nestle Hispanic Employee Association, Nestle Women network,…
o Environment of support & mentorship
THANK YOU!
References.
o The 14 Worst Corporate Evildoers, http://www.laborrights.org (2005).
o Nestlé Website, http://www.nestle.com (2014).
o Nestlé Academy, http://www.nestlecareers.co.uk(2014).
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