Nestle Organizational Structure

near agreemental StructureINTRODUCTION near is a Swiss multinational nutritional and health-related consumer goods company headquartered in Vevey, Switzerland. It is the largest food company in the world. draw nears products embroil baby food, coffee, confecti integrityry, bottled water, breakfast cereals, dairy products, ice cream, pet foods and snacks. 29 of go ups brands have annual sales of over 1 billion CHF (about US$ 1.1 billion), including, Nescafe, Kit Kat, Nespresso, Smarties, Nesquik, Stouffers, Vittel, and Maggi. go up has nigh 450 factories in 86 countries, and employs around 328,000 people all around the world. It is one of the master(prenominal) stockholders of LOreal, the worlds largest cosmetics company. come near was create in 1905 by the merger of the Anglo Swiss Milk Company, established in 1866 by brothers George Page and Charles Page. The company grew signifi kindletly during the First World War and again following the Second World War, increasing its houseings beyond its early condensed milk and infant formula products. The company has made a number of corporate acquisitions, including Crosse Blackwell in 1950, Findus in 1963, Libbys in 1971, Rowntree Mackintosh in 1988 and Gerber in 2007. In 2011, Nestle was listed Number one in the Fortune Global 500 as the worlds most profitable corporation. With a market capitalization of $ 200 billion, Nestle ranked Number 13 in the FT Global 2011. (Nestle2011)Henry Nestle (1814-1890)Nestle System and Organization StructureA companys organizational chart typically demonstrates relations between people inwardly an organization. Such relations might include managers to sub-workers, directors to managing directors, chief executive officer to various departments, and so forth. When an organization chart grows too large it can be split into smaller charts for separate departments within the organization.The different types of organization charts includeHierarchicalMatrixFlat (also known as H orizontal)Nestle Company is a decentralized organization that is organized match to the matrix structure. Nestle as a decentralized organization permits to subordinate branches to enjoy a proportionately high- take of independence. Although it still makes major strategy decisions at the headquarter level, daily operations argon left up to subordinate branches to derive and perform. The responsibility for operating decisions is push down to local units (Broeckx Hooijberg 2008).In organization structure, intricate system is a system that is comprises a large number of entities that display a high level of nonlinear interactivity. There be number of elemental observations that have been made through the examination of complex systems, mainly using computer simulation and the mathematic of non-linearity. (Unden 2001)Complex systems are ordinarily open systems. Nestle, over its gigantic historical development from a small village operation to the worlds leading food Company, has i llustrate an excellent capability to adjust to an ever-changing external environment, without losing its elemental beliefs and core values, so important for long-term success. Over the years to come, this capability will continue to be challenge even more as Nestle is growing in size and complexity up to a dimension, which demands a continuous development of its organisation and of the way in which it run (Chris occurher Yannicrumar 2008).(D.Rigby 2009)Nestle Organization ChartIn Organization chart, we can see that the management of Nestle is also divided into 3 types top-level management, middle level of management and low-level management. take Level of forethoughtIt contains of board of directors, chief executive or managing director. The top management is the final source of authority and it manages aims and policies for an initiative. It dedicates more time on intend and coordinating functions.The role of the top management can be summarized as followsTop management broad p olicies of the enterprise and lays down the marks.It issues necessary instructions for supply of subdivision procedures, schedules, budgets, etc.It prepares strategic policies plans for the initiative.It appoints the executive for middle level for instance departmental managers.It coordinates controls the activities of all the departments.It is also prudent for maintaining a contact with the outside world.It provides circumspection and guidance.The top management is also responsible towards the stockholders for the performance of the initiative.Middle Level of instructionThe branch managers and departmental managers constitute middle level. They are responsible to the top management for the operative of their department. They devote more time to directional and organizational functions. Their role can be highlighted asThey execute the plans of the organization in consonance with the policies and directives of the top management.They make plans for the sub-units of the organi zation.They participate in training employment of lower level management.They understand and explain policies from top-level management to lower level.They are also responsible for inspiring lower level managers towards better performance.Lower Level of ManagementLower level is also known as operative/supervisory level of management. It contains of supervisors, superintendent section, officers etc.. Their activities include Assigning of jobs and tasks to various workers.They instruct and guide workers for day-to-day activities.They are responsible for the quality as well as quantity of production.They are also entrusted with the responsibility of maintaining good relation in the organization.They communicate workers problems, suggestions, and recommendatory appeals etc to the higher level and higher-level goals and objectives to the workers.They friend to solve the complaints of the workers.(Nestle 2012)Nestle System Methodology and ObjectivesNestle objectives are to be known as a world leader in Nutrition, Wellness, Health, trusted by all its stakeholders and to be referenced for financial performance in its industry. The company believes that it is not just about size, it is also about behavior and they recognized that trust is earned only over a long stopover of time by systemically delivering on their promises. These objective and behaviors are summarizing in the simple phrase Good food, Good life, a phrase that sums up the company crease aspiration.The Nestle road map is intended the create alignment for workers behind the unified set of strategic priorities that will hasten the achievement of company objectives. These objective demands from workers a mixture of long-term motivation bringed to build for the future and short-term business actions, delivering the necessary level of performance. The Nestle model is securing the progress at present and ensuring success in futureAchieving simplicityInvestment of growthScale benefitsDriving performanceThe Nestle road map includes triplet main separateCompetitive advantagesGrowth driversOperational pillars(Hemingway 2002)All these may define with one absolved and simple charthttp//www.nestle.lk/asset-library/PublishingImages/About%20us/roadmap_large.jpg(Nestle 2012)Nestle has its own company in many countries. The head office in Switzerland works very closely with them, and sets the overall strategy the overall strategy, which is managed through the strategic business units and management. Geographically, Nestle three zones (Europe the Americas Asia Oceania Africa and the Middle East) work closely with the local markets. Their primary role is that enablers, acting as the voice of the headquarters. All units and zones share Nestle vision so that everyone around the world understands the direction to take and how to get there with common tools, common values and strategic.This ensure that people in a the world know how to act, and that there is a very strong frameworks of clear ref erences and value for fast and efficient decision-making.PROBLEMS AND CHALLENGES IDENTIFICATIONNestle produces hundreds of products, has a global network of suppliers, and ten-fold selling street and distri exactlyion. Therefore, to respond and predict in this rapidly changing in market demand condition is very difficult. When predicting a market demand, Nestle will need information to discover shifts in demand early so they could adjust for trends and send the right messages to the suppliers, shippers, and distribution centers before they are deluge with unwanted or defective goods or shortages. (Manhattan Associates. 2010)However, every company has its weakest links, so is Nestle. The weakest links are matters they are unable to control (Labs. 2010). Firstly, the most usual problem is the sources of supply of birthday suit materials. This is due to an unexpected and sudden increase in demand, which will cause extreme supply shortages for merchandises that will result in major p rice increases. For example, gravid natural disaster and bad weather have always been an issue affecting incoming raw materials. Secondly, the mistakenness of orders authentic in record. No company can ever achieve the requirement of zero imperfections especially in foods and beverages industry. For example, when the purchasing department of Nestle ordered 15,000 of mixed yoghurt from its dealer, but what the retailer received was only 12,000 of them, or on another case they might receive lacking records. Another example is, when Nestle tells its dealer that they unavoidable extra orders of a particular product to be shipped right away because of unpredicted increase in demand, but in fact, the supplier may already has orders from other customers. This usually happen during special occasion. (Mashabale2012)Hence, in order to solve these problems, it is critical for Nestle to engage with multiple dealers or suppliers in that specific region, so they could purchase inventories from multiple dealers, which will definitely reduction the risk of shortage due to incontrollable situation. Besides, Nestle should also base on their purchase and demand planning on lastly couple of years of sales to estimate current year of supply and demand. Other than that, mutual trust and strong relationship with all the dealers are needed in order to raise the flexibility of material supply management, as well as to improve the bargaining power of Nestle. However, if there is a extra, Nestle may need to plan a promotion to clear their inventories, otherwise Nestle will meeting a great loss such as waste of warehouses space, paying high material handling cost, or inventories that are not sold became defective and may need to be disposed which no profit will earn. Therefore, when there is a big event organized such as big Carnival. Nestle will set up a booth at the carnival to sell its products, which are close to the expiry date at lower price such as Maggi products, Nescafe, yog hurt drinks, Milo, Nestle ice creams and so on. People often buy the products in big quantity because of the lesser price than the market price. As a result, Nestle could clear their inventories rather fast and save some space in the warehouses which is a win-win situation.Thirdly, although Nestle has a logistics department but it does not deal with transportation logistics. Nestle subcontracted its supply drawing string transport to the third-party logistics as Nestle tries to cut their supply chain costs and to concentrate more on their in-plant operations. Although Nestle does not have, a transportation logistics department but they do have a delivery team to cooperate with the third-party logistics in routing protocol. Nestle is using a Dynamic antecedent Routing (DSR), which is a simple and efficient routing protocol designed specifically for use in multi-hop wireless ad hoc networks of mobile nodes. The protocol is composed of the two main mechanisms of Route Discovery and R oute Maintenance, which work together to allow nodes to discover and maintain routes on-demand to arbitrary destinations in the ad hoc network. (Maltz. 2003). Therefore, the delivery team is there to help Nestle and the third party Logistic that DSR is working as per company direction as well as DSR performance.Then, it is the poor partnership relationship between consumer and dealership. Dealers need these capabilities because they in close partnership with manufacturers Nestle, are a connecting hub of services for the consumers, and other stakeholders. However, Nestle solved this problem by using the Dealer Management Systems (DMS) as well as their dealers. DMS is a software solution that provides tools for managing service, sales, parts and inventory management, integration, business management, and core architecture. DMS help manufacturers and dealers create integrated marketing movements to offer inventory to goal markets. This will integrate innovations into traditional in-st ore sales and service processes and offer technologies for non-traditional merchandising, service and sales strategies through alternative channels for consumer engagement in-vehicle, via Web, or by phone. (Microsoft Corporation. 2008)RECOMANDATIONS FOR PLOBLEMSAfterward the reviews stated above, those were not the only solutions that are available. Nestle could acquire the inventories from the other outlets from the other region Instead of just finding or having multiple suppliers. Because some regions have different demographics, for example, race. If there is a surplus, and unable to clear the inventories at a short time, Nestle could consider donation for short-term purpose, this could help to clear the old stocks, as well as to helpNestle could use both manual and automation system in managing service, sales, and others. This is because one cannot trust wholly to a machine, as it may not be documenting the steps in its own processor. Because some steps cannot be automated and m ay require operator intervention to stop the escapement processing steps, even though adapting advanced technologies could help saving cost as labor cost is decrease, but if there are still problems occur, it will affect the business such as loss of customers because of the mistake. Consequently, Nestle must update the system software regularly and full utilization of available technology as well as the manual operators, which will effectively increase the efficiency and dependability of the supply chain systems. 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