nestle..times report
TRANSCRIPT
Management TIMES
Management TIMES
Report on Management
Topic
Managing Decision Making and Problem Solving
Submitted To, Tasman Pasha.
Submitted By,Group
I.I. Hira Ilyas,6
II.II. Saba Javaid,8
III.III. M. Ahmad,19
IV.IV. M. Adnan, 27
V.V. Waqar Akram 13
Date of submission 27-6-2011
Department B.B.A
Semester2nd
TIMES
The Institute of Management & Emerging Science Multan, Pakistan
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Dedication
We dedicated this report to our Parents. Who taught us that the best kind of
knowledge to have is that which is learned for its own sake. Without their
Patience, understanding, Support and most of all Love, the completion of
this work would not have been possible.
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ACKNOWLEDGEMENT
This is not a traditional research project. It is the result of brain storming of our group
members. Keeping in mind the target we have to select a product with some creativity in its
advertising campaign. While doing the project we worked very hard and tried our best to use our
efforts.
We would like to express our gratitude to all those who gave us the possibility to complete this report.
We want to thank the Mr. Imran Atari for giving us permission to commence this report in the first
instance, to do the necessary research work and to use company’s data. We have furthermore to
thank the Miss Shazia H.R Manager who gave and confirmed this permission and encouraged us to
go ahead with our report.
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We are deeply indebted to Prof. Mr. Tasman Pasha from the TIMES University Multan Pakistan
whose help, stimulating suggestions and encouragement helped us in all the time of research for and
writing of this report.
My former colleagues from the Department of B.B.A supported us in our research work. I want to
thank them for all their help, support, interest and valuable hints. Miss Arifa and Mr. Adnan were of
great help in difficult times. Moreover, looked closely at the final version of the report for English style
and grammar, correcting both and offering suggestions for improvement.
Especially, we would like to give our special thanks to Nestle Company that enabled us to complete
this work.
PREAMBLEPraise is to Allah Almighty, the one testing us all at all times and making decisions about what we do
not know and can’t know.
Today it is impossible for a common person to run the business especially in this period of
competition. This situation demands energetic, duly qualified experienced business administrators
who could meet the challenges of this age of modernization. Department of Business Administration
undertakes to produce management specialists fully aware of the ins and outs of the business
management, and capable of meeting the challenges of
modern business environment.
Gratitude
It’s been so long since I learned my first word, but I promise that I still remember the first day at
school, when I was just four and very reluctantly entered my Nursery class, my teacher gave me a
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pat on my back and a packet of Chips. I wonder how time passes without letting anyone know how
much it has actually passed.
When I was starting this preface portion of my report, my heart almost stopped beating and my eyes
filled, with gratitude for every single person whom I owe my bits of knowledge, and now when I am
verge of leaving my academic career, I feel that those sixteen years are never existed in my life. This
report, one of the last monuments of study career, makes me sad.
I do not want to take any of the credit for this report; instead, I want to dedicate to all those people
who have contributed to my learning at any stage. I would not be going justice in presenting this
internship report without mentioning the people around me who have been inextricably related with
the completion of this report.
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Introduction Nestle is a multinational company. As the world's number one Food and Beverages Company, Nestlé
is a complex organization, operating in challenging and varied business environments.
To fulfill our commitment to serve our customers better, we are adopting common business practices
in all areas of business.
This vision is at the heart of GLOBE – Global Business Excellence, and Nestlé Pakistan is proud to
be part of this international initiative. We know that by standardizing the way we capture and report
business data, and by putting our IT infrastructure on a global platform, we can be more flexible and
focused on our products and brands, and therefore more responsive to our customers.
Company’s Vision
Nestlé’s global vision is to be the recognized leading Nutrition, Health and Wellness Company. Nestlé
Pakistan subscribes fully to this vision of being the number one Nutrition, Health, and Wellness
Company in Pakistan.
In particular, we envision to;
• Lead a dynamic, motivated and professional workforce – proud of our heritage and positive
about the future.
• Meet the nutrition needs of consumers of all ages – from infancy to old age, from nutrition to
pleasure, through an innovative portfolio of branded food and beverage products of the highest
quality.
• Deliver shareholder value through profitable long-term growth, while continuing to play a
significant and responsible role in the social, economic, and environmental sectors of
Pakistan.
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Company’s Mission
To positively enhance the quality of life of the people of Pakistan by all that we do
through our people, our brands, products, and our CSV activities. Mission Statement.
Nestlé is dedicated to providing the best foods to people throughout their day,
throughout their lives, throughout the world. With our unique experience of anticipating
consumers’ needs and creating solutions, Nestlé contributes to your well-being and
enhances your quality of life.
Good Food for Good Life.
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Company’s AmbitionGOOD FOOD GOOD LIFE
To be the leading Nutrition, Health and Wellness Company
We believe that every single company, no matter where in the world it operates, ought to be fully integrated into the local social, cultural & economic life. We must be good corporate citizens, and give back to the societies to which we belong.
• Through social investments: giving to charities, leading and supporting cultural or welfare initiatives.
• Through the realizations that businesses create social and environmental impacts, both positive & negative, through the daily operations of their value chain.
MD`s Message
Commitment to excellence, good food & good life are words that best describe Nestlé. We at Nestlé Pakistan are a team of people committed to adding value to the lives of the Pakistani people by helping them live a life full of wellness & vitality.
We welcome you to this life.
Nestlé with its operational excellence, best management practices and total commitment to quality has you our consumer at the heart of everything we do.
We sincerely thank you for believing in Nestlé and our products & making our journey to success ever more possible.
Our aim is to make our consumers well aware of what they eat and how to take care of their nutritional needs. We, therefore, invite you to get to know our products better and to look at our unique features on this website where you will discover informative pieces that will help you make healthier and balanced choices in your and your family’s lives.
Enjoy your visit to our Nestlé Pakistan website and we hope you will visit again often.We wish you Good Food Good Life.
Ian James DonaldManaging Director
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HistoryNestlé headquarters in Vevey.
Nestlé S.A. is the largest food and nutrition company in the world,
founded and headquartered in Vevey, Switzerland. Nestlé
originated in a 1905 merger of Anglo-Swiss Milk Company,
established in 1867 by brothers George Page and Charles Page,
and Farine Lactée Henri Nestlé, founded in 1866 by Henri Nestlé.
The company grew significantly during the First World War and
following the Second World War, eventually expanding its offerings
beyond its early condensed milk and infant formula products. Today, the company operates in 86
countries around the world and employs nearly 283,000 people.
The company dates to 1867, when two separate Swiss enterprises were founded that would later
form the core of Nestlé. In the succeeding decades, the two competing enterprises aggressively
expanded their businesses throughout Europe and the United States.
In August 1867 Charles A and George Page, two brothers from Lee County, Illinois, USA established
the Anglo-Swiss Condensed Milk Company in Chum. Their first British operation was opened at
Chippenham, Wiltshire in 1873.
In September 1867, in Vevey, Henri Nestlé developed a milk-based baby food and soon began
marketing it. The following year, 1868 saw Daniel Peter begin seven years of work perfecting his
invention, the milk chocolate manufacturing process; M. Nestlé's was the crucial cooperation M. Peter
needed to solve the problem of removing all the water from the milk added to his chocolate and thus
preventing the product from developing mildew. Henri Nestlé retired in 1875, but the company, under
new ownership, retained his name as Farine Lactée Henri Nestlé.
The key factor, which drove the early history of the enterprise that would become the Nestlé
Company, was Henri Nestlé's search for a healthy, economical alternative to breastfeeding for
mothers who could not feed their infants at the breast.
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In the mid-1860s Nestlé, a trained pharmacist began experimenting with various combinations of
cow's milk, wheat flour and sugar in an attempt to develop an alternative source of infant nutrition for
mothers who were unable to breast feed. His ultimate goal was to help combat the problem of infant
mortality due to malnutrition.
He called the new product Farina Late Henri Nestlé. Nestlé's first customer was a premature infant
who could tolerate neither his mother's milk nor any of the conventional substitutes, and had been
given up for lost by local physicians. People quickly recognized the value of the new product, after
Nestlé's new formula saved the child's life and within a few years, Farine Lactee Nestlé was being
marketed in much of Europe.
Henri Nestlé also showed early understanding of the power of branding. He had adopted his own
coat of arms as a trademark; in his German dialect, Nestlé means 'little nest'. One of his agents
suggested that the nest could be exchanged for the white cross of the Swiss flag. His response was
firm: "I regret that I cannot allow you to change my nest for a Swiss cross .... I cannot have a different
trademark in every country; anyone can make use of a cross, but no-one else may use my coat of
arms."
Meanwhile, the Anglo-Swiss Condensed Milk Company, founded in 1866 by Americans Charles and
George Page, broadened its product line in the mid-1870s to include cheese and infant formulas. The
Nestlé Company, which had been purchased from Henri Nestlé by Jules Mannerist in 1874,
responded by launching a condensed milk product of its own. The two companies remained fierce
competitors until their merger in 1905.
Some other important firsts occurred during those years. In 1875 Velvety resident Daniel Peter
figured out how to combine milk and cocoa powder to create milk chocolate. Peter, a friend and
neighbor of Henri Nestlé, started a company that quickly became the world's leading maker of
chocolate and later merged with Nestlé. In 1882 Swiss miller Julius Maggie created a food product
utilizing legumes that was quick to prepare and easy to digest.
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His instant pea and bean soups helped launch Maggie & Company. By the turn of the century, his
company was producing not only powdered soups, but also bouillon cubes, and sauces and
flavorings.
The Company formed by the 1905 merger was called the Nestlé and Anglo-Swiss Milk Company. By
the early 1900s, the Company was operating factories in the United States, Britain, Germany and
Spain. In 1904, Nestlé added chocolate to its range of food products after reaching an agreement
with the Swiss General Chocolate Company.
Condensed-milk exports increased rapidly as the Company replaced sales agents with local
subsidiary companies. In 1907, the Company began full-scale manufacturing in Australia, its second-
largest export market. Warehouses were built in Singapore, Hong Kong, and Bombay to supply the
rapidly growing Asian markets.
Most production facilities remained in Europe, however, and the onset of World War I brought severe
disruptions. Acquiring raw materials and distributing products became increasingly difficult. Fresh-
milk shortages throughout Europe forced factories to sell almost all their supplies to meet the needs
of local towns.
Nevertheless, the war created tremendous new demand for dairy products, largely in the form of
government contracts. To keep up, Nestlé purchased several existing factories in the United States.
By war's end, the Company had 40 factories, and its world production had more than doubled since
1914.
The first half of the 1990s proved to be a favorable time for Nestlé: trade barriers crumbled and world
economic markets developed into a series of more or less integrated trading areas. The opening of
Central and Eastern Europe, as well as China, and a general trend towards liberalization of direct
foreign investment was good news for a company with interests as far-flung and diverse as Nestlé.
While progress since then has not been as encouraging, the overall trends remain positive.
In July 2000, Nestlé launched a Group-wide initiative called GLOBE (Global Business Excellence),
aimed at harmonizing and simplifying business process architecture; enabling Nestlé to realize the
advantages of a global leader while minimizing the drawbacks of size.
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There were two major acquisitions in North America in 2002: in July, Nestlé announced that the U.S.
ice cream business was to be merged into Dreyer's, and in August, a USD 2.6bn acquisition was
announced of Chef America, Inc. , a leading U.S.-based hand-held frozen food product business.
Also in 2002, the joint venture Dairy Partners Americas was set up with Fonterra; and Laboratories
innerve was set up, another joint venture, this time with L’Oreal.
The year 2003 started well with the acquisition of Move pick Ice Cream, enhancing Nestlé's position
as one of the world market leaders in the super premium category.
In 2006, Jenny Craig and Uncle Toby's were added to the Nestlé portfolio and 2007 saw Novelties
Medical Nutrition, Gerber and Hinnies join the Company.
Nestlé entered into a strategic alliance with the Belgian chocolaty Pierre Marceline at the end of that
year. In 2008, Nestlé began a process of selling Alcona by divesting 24.8% to Novelties.
In 2009, Nestlé opened the Chocolate Centre of Excellence in Broc, Switzerland, with Pierre
Marceline one of the master chocolates.
The new decade began with Nestlé announcing the finalization of the sale of Alcona to Novelties,
which was completed mid-year. This represented a remarkable investment on behalf of Nestlé
shareholders. Immediately following the Alcona announcement, Nestlé bought Kraft’s frozen pizza
business.
Further highlights were the launch of the Specialty tea machine system and the completion of the
CHF 25 billion share buyback programmer – and the announcement of a new CHF 10bn
programmed.
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PROFILE OF THE COMPANY
Nestlé with headquarters in Vevey, Switzerland was founded in 1866 by Henri Nestlé and is today the
world's biggest food and beverage company. Sales at the end of 2004 were CHF 87 bn, with a net
profit of CHF 6.7 bn. We employ around 247,000 people and have factories or operations in almost
every country in the world.
The Company's strategy is guided by several
fundamental principles. Nestlé's existing products
grow through innovation and renovation while
maintaining a balance in geographic activities and
product lines. Long-term potential is never sacrificed
for short-term performance. The Company's priority is
to bring the best and most relevant products to
people, wherever they are, whatever their needs,
throughout their lives. Our products are manufactured in five facilities scattered around the country,
from Islamabad in the north, to Karachi in the south. Two state-of-the-art multipurpose factories are
located in the agricultural heartland of the Punjab, and the remaining three are dedicated to
producing our trusted brands of bottled water. As citizens of Pakistan, we consider it our duty to make
sure that our manufacturing processes are clean, hygienic and safe. We are constantly working to
reduce emissions at our factories, reducing and treating wastewater, and making our packaging
environmentally friendly. Regular audits have confirmed that our factories' environmental
management meets the Nestlé international standard.
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Kabirwala Factory
Kabirwala Dairy Ltd., as it then called, was establish in 1983 as a UHT milk processing plant. Nestlé
Milkpak Ltd acquired it in 1990 as a subsidiary and installed the MAGGI NOODLES plant in 1992.
Nestlé Milkpak Ltd setup its second milk powder plant at Kabirwala in September 1996, which
produces NIDO, GLORIA, AND skims milk powders.
A new evaporator was installed and commissioned in 1999, followed by a capacity increase of milk
powder production by 150%. The year 2000 also witnessed the launching of premier quality cultured
butter in 100gm And 200 gm packing. In 2001, this butter made available for institutional sale in 10gm
packing.
This factory is now a fully owned unit of Nestlé Milkpak Ltd since April 1997 and is called Kabirwala
Factory.
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Nestle products:
Nestle Milkpak
Welcome health, strength and happiness into your home with delicious and
nutritious MILKPAK; standardized UHT milk that benefits from Nestlé’s
expertise in bringing you the very best in health, wellness and nutrition.
MILKPAK is a trusted brand known throughout the country for its nutritious
wholesome goodness and pure natural taste. Nestlé MILKPA K is the pioneer
brand in the U HT milk market, lends credibility and holds strong brand equity
with consumers. I t continues to enjoy market leadership position in the U HT
category because of it’s excellent product, aggressive sales & marketing and consistent efforts from
technical and production.
In order to keep fulfilling the nutritional requirements of the consumers and create a
significant differentiating factor, Iron Fortified Nestlé MILKPA K offers consumers
value addition in the form of Iron, which is a very important mineral performing
several key functions in the human body. In addition, Vitamin C and A have also
been added. Nestlé MILKPA K is now every homemaker’s partner in helping her
strengthen her home.
MILKPAK UHT cream launched in 1986 is the market leader in the packaged U HT cream category.
It has established this respectable position through developing a longstanding bond of trust with
consumers based on its quality and 24 year history under the MILKPA K brand. Its silky creamy
texture is ideal with delicious fruits, coffee and used commonly as a generous dollop on “naan”. This
brand has emotionally reached out to ethnic cultures through family values and traditions.
One of the biggest brands of Nestlé globally, NI DO was launched in Pakistan in
1990. Since then NIDO has grown from strength to strength to become the
mother’s most trusted partner in catering to her children’s growth and
development. A long with the natural goodness of pure milk, NIDO is now enriched
with Minerals and Vitamins that help in holistic development of children.
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Pakistan’s Favorite Water.
NESTLÉ PURE LIFE is pure, safe and healthy drinking water for you and
your family. Every bottle of NESTLÉ PURE LIFE is produced with the
Nestlé Safety System and is carefully sealed with a proprietary seal. An
optimal balance of essential minerals, enhancing the health and wellbeing
of your family, matches purity of the highest standards.
NESTLÉ PURE LIFE, the world’s number one bottled water brand with presence in 26 countries, was
launched in 1998 in Pakistan.
Nestlé Waters Pakistan is one of largest Nestlé Waters markets, and still continues to grow well
today. This fact is evident in the ever growing distribution, customer base and communication
investments made by the company for its consumers.
The brand is rated as the most preferred bottled water brand in Pakistan by
consumers according to research studies. In 2009, the brand continued to
expand its mission to delight consumers by providing high quality, safe and
pure drinking bottled water. To promote healthy hydration as part of health
and wellness, the 8 glasses a day campaign was used throughout the year
in communication to educate consumers on the need for adequate
hydration. The communication reached consumers on platforms like TV,
radio, print, billboards, packaging, internet and POS
materials.
The idea was incorporated in a nationwide lucky draw consumer promotion on the PET format at the
end of the year which enabled the PET business to enhance growth and enabled the brand to own
the “8 G lasses a Day” platform.
A mega consumer promotion was launched on the HOD format to acquire new consumers at the start
of the year. Two more activities were rolled out at the end of the year to drive consumption and sales.
To stay competitive in the market by offering the right price for the consumers, an innovative shrink
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wrap packaging solution was launched on the PET format. State of the art machinery was installed in
the Shiekhupura factory in May 2009. T his enabled the palletized shipment of the product from the
factory to the distributors; increasing the efficiency through out the value chain.
Cerelacwhether it is your first-born or even your third bundle of joy – each baby is
unique and special. You want the best for your baby in every way and that
means the best nutrition for your baby’s healthy development, giving him or her
solid foundation for a bright and healthy future! Baby Food: March 2009 saw
the launch of CERE LAC Stage 3 in two variants:
“CERE LAC with Apple, Strawberry& P ear pieces” and “CERE LAC with O
range & Apple pieces”. Both variants, targeted to extend CERE LAC consumption beyond the age of
8 months, offer functional benefits of “Helping Baby Learn to Chew” and introducing the baby to new
textures. Launch of these variants was aptly supported by a strong campaign centered on “baby Bara
HoGya” central idea. Response from consumers has been overwhelming and is reflected in
exceptional sales of these newly launched variants.
Even bigger was the reliance of entire portfolio of CERE LAC with addition of Proboscis, offering the
big internationally claimed benefit of strengthening of baby’s natural defenses through the critical first
year of life. T he launch is being supported by a big T V campaign along with extensive outdoor
presence, medical detailing, sampling through health care professionals and extensive trade
presence. Additionally, the entire packaging has been redesigned so that it is not only more vibrant,
but also illustrates the functional benefit clearly.
Infant Formula: LACTOGEN GO LD was launched with the aim to
create inroads into the premium segment by leveraging STRONG
brand equity of LACTOGEN, owning benefit-based territory of “Gut
Comfort”. Available in an exclusive moralized soft packaging, the
newly designed GO LD color packaging has received tremendous
appreciation in the Nestlé world.
Similarly, LACTOGEN 3 was launched in April 2009 as a Junior Follow
up formula for infants 10 months and above. The new extension has received tremendous
acceptance as the volumes have been increasing continuously on a monthly basis.
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In addition to the above launches, the renovated recipe of New A L 110, with beneficial ingredients
DHA/ ARA, was introduced in July 2009.
These new ingredients are present in human milk, and are important for adequate cell membrane
structure and function development, and immunomodulation. Extensive launch and training sessions
were conducted with more than 1,500 Nestlé sales and distribution personnel followed by
independent training sessions for the medical detailing staff.
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Have a break, have a KITKAT
Chocolate is one of the most loved indulgences around the world.
It is one of life's little pleasures, which delights the senses of all ages.
KITKAT is by far one of the most popular chocolates all around the world! Its trademark red and white
colors and the distinct KITKAT logo make it one of the most recognized brands ever. Chocolate is a
small but fast growing segment in Pakistan.
Nestlé KIT KAT was launched in 1996 to make in roads in this market. It is available in 11g (Mini) 17g
(Two finger) and 35g (Four finger) sizes. With a focused distribution approach and marketing
activities the brand has shown potential to grow in the market and is a leading value driver for the
confectionery business of the company in Pakistan.
KITKAT Chunky is a single solid finger that is perfect for those who want a mouthful!
Launched in Pakistan in 2005 KIT KAT Chunky is Nestlé’s giant single wafer version of the world
famous brand – KIT KAT . T he launch was part of the global strategy to make. KIT KAT the largest
selling chocolate brand in the world.
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MAGGI realizes that mums feel the need of being more fun around their children; therefore, it gives
them a chance to break out from their mum mould. Now involve your little ones in the kitchen for a
supervised activity full of fun and great learning as they help prepare MAGGI Noodles for themselves.
2 Minute Noodles
Nestlé pioneered the instant noodles category in Pakistan with the launch of MAGGI 2-MINUTE NOO
DLES in 1992. Today the MAGGI brand is well known, with strong equity amongst its target
consumers. During 2009 MAGGI has reinforced its image of being a partner for mothers to deliver
good food-moments to their kids. Keeping consumer at its heart, the brand is utilizing global R &D
expertise to further innovate & renovate its portfolio in the coming years.
NES QUIK2009 saw the addition of another fun filled brand for Nestlé Pakistan with the
launch of NE SQUI K. T he brand recognizes the challenge faced by the mums of
today who continuously try to strike a balance between their kids needs e.g. good
health and education and their wants pertaining to a fun filled childhood. For this
same reason NE SQUI K is here to celebrate childhood for kids and to become
an ally for mom’s in their battle to get their kids to drink milk. NE SQUI K
dissolves instantly in both hot and cold milk and is available in the following SKUs.
NE SQUI K Chocolate 200g
NE SQUI K Chocolate 400g
NE SQUI K Strawberry 200g
NE SQUI K Chocolate 12g - Single Serve
NES CAFÉ
NE SCAFÉ is the world’s favorite coffee brand. No matter whether you like a cup of pure and black
coffee or a frothy and creamy cappuccino NE SCAFÉ is there to suit your taste and your mood. In
2009, NE SCAFÉ continued to exhibit a growth trend. This growth is mainly attributed to focused
distribution efforts and a timely consumer promotion that was rolled out with the objective of
increasing off-take.
Nestlé MILOReady To Drink (RTD) MILO RT D is a major player in the flavored milks category and enjoys a strong association with the consumers. Launched in 1994, MILO RT D has shown sustainablePerformance over the years. T his year the 200ml wedge pack was changed to a more convenient 200ml slim pack, this helped in further enhancing the value of the brand. I t is popular with all age
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groups specially children and consumers who are looking for energy and taste and seek a healthy active lifestyle.
Nestlé FRUITA VITALS
2010 proved to be yet another “fruitful” year for the brand. Even in the wake of
floods and rising inflation, that put pressures on the consumers’ purchasing power,
Fruita Vitals continued it’s double digit volume growth on account of a strong
consumer pull. The year commenced with a holistic, 360 degree, “Rise and Shine
to Life” campaign focusing on slice of life representing different consumption
occasions. As a result of this campaign,
Fruita Vitals is the preferred juice brand of the consumer. The third quarter marked
the addition of Peach Nectar, a new exotic variant. The consumer response for
peach was overwhelming with the actual sales doubling versus forecast. In
addition, the off-season launch helped retain excitement on the brand even during the lean months.
On digital, 2010 was a landmark year, with Nestlé Fruita Vitals becoming the largest Pakistani FMCG
brand with a Face book fan following of 100,000+. “Aurora”, an advertising magazine, also
commended the success of the brand’s Face book page. Given the passion of the new generation for
music and style, we recognize that young people are always on the lookout for entertainment, and
that musical events and style awards can be a great way to reach out to them. Nestlé Fruita Vitals is
committed to creating healthy, recreational platforms for youth and endorsing youth icons. To this
end, we organized and sponsored several music and style events graced by various celebrities and
glitterati. These events were also captured on digital and TV for an extended reaches.
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Other Products
We believe that food plays a key role in achieving a well-balanced person. And so our philosophy is
Good Food for a Good Life! At Nestlé, our products are developed keeping our consumers, their
preferences and health in mind. Millions of consumers the world over trust Nestlé products for good
reason: when they choose a Nestlé product they have the satisfaction of choosing quality, taste,
variety, convenience and the good nutrition. With over 140 years of experience and expertise, we
take great pride in bringing you a portfolio of health and wellness because happy, healthy consumers
are important to us.
Nestlé’s Developing Programs
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Rural developmentUnder its R Ural Development, Nestlé Pakistan Limited refurbishes
Primary Schools in the most remote areas of the country. Selection of
schools is carried out keeping in mind the Nestlé “Creating Shared Value
guide lines”, requirements of local community and with feedback from
field staff. The projects for these schools include construction of new
block, addition of new classrooms and repair / renovation of existing
facilities. In addition, provision of facilities / utilities, such as, provision of electricity, clean drinking
water, and computer labs, furniture, playground equipment etc are carried Out as part of activity.
Nestlé Pakistan Ltd. also donated a 14 bed CCU Ward at the District Headquarter Hospital
Sheikhupura which is now fully functional and catering the medical needs of Distt Sheikhupura and its
surroundings. Nestlé Pakistan also provides significant support for research and development, and
need/ merit based scholarship Programs, to some of the most prestigious educational institutions in
the country.
Farmer Development
Dairy is the major business component of Nestlé Pakistan and the
company collects milk from 150,000 associated farmers spread over
145,000 square kilometers. The farming practices are still very traditional
with low yield animals, poor infrastructure in rural areas, lack of modern
and best farm practices and lack of skilled farmers. The sustainability in
long-term needs a CSV based “Dairy Sector Development Approach”, both for the farmer and the
Industry. Nestlé Pakistan has established a formal Agri-Services Division to provide free of cost
veterinary support to farmers in rural areas.
Driver Safety Training Project
Nestlé Pakistan signed an agreement with National Highways & Motorway Police through which the
Company extended support for the development of a fully equipped Driver T raining facility at the
National Highways & Motorway Police T raining Institute at Sheikhupura. T his training facility will
include a T raining Hall equipped with a Driver training Simulator, with adjacent offices and rest room
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facilities for the trainees, and a driver-training track. T his is first of its
kind initiative in the country, which promotes the concept of public
private partnership in Pakistan.
The training facility will allow participants to acquire specialized
driving practices and would curb accident rates on motorway through
requisite skills that will be gained during the training period. What started as a pilot drivers training
program in April ’08, has up till now resulted in 13 batches of drivers, i.e. more than 300 drivers,
graduating from the Motorway T raining Institute
Sheikhupura.
This unique training facility will not just provide training facilities to the Nestlé Pakistan’s Drivers but will be extending support in road safety awareness to the entire corporate sector in the country.
Healthy Kids Program in Pakistan
Mr. Paul Bulcke, CEO, announced at our Creating Shared Value Forum in New York this year, the
creation of the Nestlé Global Healthy Kids Programmed, to be implemented in all countries where
Nestlé has operations. The aim of this program will be to raise awareness for addressing the
nutritional needs of the school going Children from the age group of 06 years to 16 years. The plan is
to launch the pilot phase in 2010, with the objective of active program in 2011. Nestlé Pakistan
subscribes fully to this vision. And it is this vision that will steer our way towards the development of
the Healthy Kid program for Pakistan.
Nestlé UNDP Partnership Project
The project titled as “Community Empowerment through Livestock Development & Credit”
(CELDAC), started in Sep 2006 and successfully ended in September 2009. During this three-year
program, a total of 3400 female livestock workers were trained, covering more than 2000 villages in
rural Punjab (Nestlé Component). These trained women livestock workers are now successfully
working as:
• Livestock Health Caretakers
• Village Milk Collection A gents
• Animal Feed Suppliers
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Nestlé Professional
Our vision: “To be an inspiring growth partner that delivers creative, branded food and beverage
solutions, enabling operators to innovate and delight their consumers.” As part of the world’s largest
food and beverage company, Nestlé Professional is passionate about supplying you with branded
solutions that are creative, customized and commercially viable. In our relentless drive for excellence,
we aim to continue to:
1. Share our expertise with you
With over 100 years’ knowledge and experience in food and beverage, we’re here to share our skills
with you and advise you, using our deep, authentic market and industry knowledge, and our
scientific and technological knowhow. Our knowledge is from hands-on industry experience;
it’s not just research based. So, whatever channel you’re in – full service or quick casual restaurants,
college & university, lodging, education, health care, business and industry, leisure, convenience
stores, vending - we can quickly understand your challenges and help you develop profitable
solutions that best meet your needs and delight your customers.
2. Create profitable solutions tailored to you
At Nestlé Professional, we use our global consumer insight to create and deliver profitable new
business solutions that are right for your channel. We bring you brands that your customers trust and
love. We also offer you the service and training you need to maximize customer satisfaction,
efficiency and profitability.
3. Deliver safe, superior quality – every time In an increasingly global, competitive,
regulated and demanding market, we deliver consistently excellent products that you and your
customers can trust. With extensive research, development and qualitative analysis, we aim to
create many more such innovative products, helping you to differentiate your food service
establishment from the competition.
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Marketing and Sales
During 2010, the company continued to achieve sustainable growth by offering high quality products
to our consumers. Our sales team is fully aligned with the Nestlé Corporate Business Principles,
which forms the foundation of all our functional practices.
In alignment with Nestlé’s global priority of enhancing the distribution network, and the concept of
availability of our products “whenever, wherever and however” are fully integrated into our distribution
system. Through our strong sales infrastructure, we ensure product availability from Khunjrab pass to
Karachi in Pakistan and from Mizar-e-Sharif to Heart in Afghanistan. The Nestlé sales set up is
composed of a complex, yet efficient structure spanning over 600 cities and small towns.
This geography is covered through a distributor field force of over 6000 people and 1500 vehicles to
meet the demand. Nestlé has also embarked on a journey of rural penetration through our PPP
(popularly positioned products). To penetrate deeper into narrow streets where it is difficult to reach
with vans, “Motor bike operations” have been introduced in a bid to offer Nestlé products to the
masses so that they can also benefit from the high quality products at affordable prices.
Channel Category Sales department (CCSD)
The CCSD (Channel Category Sales Development) team has played an instrumental role in driving
the sales growth. During 2010 there have been a lot of new initiatives including the development of
new route to markets (RTM), better understanding of shoppers behavior, introduction of channel
wise Plano grams, development of the large groceries channel and sales automation. The process of
Integrated Commercial Planning was managed in a professional manner to lay down strong
foundations to capitalize on all opportunities that the market offers.
Key Accounts
The Key Account business was another growth driver in 2010 where the team worked in close
collaboration with our customers, leveraging the potential of the fast growing modern trade channel in
the country. The Key Account team has worked with an objective to generate sustainable, mutual,
profitable growth for Nestlé products and categories. Moreover, the team has focused on creating
purchase moments that enable our shoppers to make informed choices and make each shopping trip
a delightful experience at the point of purchase.
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Communications:
Efforts continued towards improving the communication of our value added offerings to our
consumers in a way that is most understandable and spot on to the benefits sought after. To better,
equip the generating demand team to drive NHW leadership recognition,
a one full day workshop was organized by the unit. There was great involvement and discussion from
all participants that brought much clarity on the Nestlé NHW vision and the strategies developed to
reach our ambition.
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Production
New ProductsKabirwala factory (KBF) achieved its all time record of new products in a calendar year by introducing
NIDO 1+, NIDO 3+, and Everyday UHT, new MAGGI Noodle flavors Karara, Bar-B-Q, Masala and
new MAGGI Umda Maza seasoning in 2010. Passed Total Performance Management (TPM)
Readiness Assessment & begun TPM journey at Liquid Dairy Pilot line KBF is the Pilot TPM factory
in Pakistan Market. We passed TPM Readiness Assessment and kicked off TPM phase Zero on 29
March 2010. Our TPM Pilot Line is “Tetra D” in Liquid Dairy Plant.
During assessment, no major roadblock was observed and 70 people from TPM pillars and work
Groups are being trained in Phase Zero. This was a great achievement by the KBF Team towards
the TPM journey.
New filler for MAGGI Umda Maza seasoning line
MAGGI, being one of our major food brands, shall play a vital role in this regard. A new Wolf machine
type VPZ 140 has been installed in our Noodle plant to pack the new Umda Maza product. MAGGI
Umda Maza is an 8gm sachet, which is used to enhance the future of everyday food cooked at home.
The Wolf Line’s capacity is to produce 70 packs /minute.
New WOLF Duplex filler, K&L lines, for Milk Powder
At KBF, a new Wolf Duplex (Double Head) machine has been added to meet market requirements.
Main activities of this project were to create space for a new filling machine and to relocate the
Schumacher. More importantly, the safety guidelines were strictly followed while working in this high
hygiene area, where there was continuous production going on. To ensure correct ratio of nitrogen
and Carbon Dioxide, the old gas mixing station was replaced with a new one. This filler will add value
towards our business and enable us to grow further in smaller SKUs.
Nestlé Continuous Excellence (NCE)
NCE is a group wide initiative, officially launched in 2008 throughout the Nestlé world. NCE is an
enabler to be brilliant at the basics, in order to delight our valuable consumers & customers with an
even higher quality, competitive cost and freshness, while excelling in compliance throughout the
value chain. This is a journey towards a LEAN enterprise where everyone is focused on activities
driving towards continuous excellence.
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Kabirwala Factory is the first site, which embarked on the NCE journey in Nestlé Pakistan in 2009.
Kabirwala successfully passed NCE Assessment in 2009, kicked off (Total Performance
Management - TPM) in March 2010, and is aiming to pass TPM phase-1 by end of 2011. Kabirwala
vision to do TPM is to be the excellent factory in the eyes of our Consumers and Customers.
Sheikhupura Factory made remarkable efforts and achieved 80% score during NCE Foundations
Assessment in Nutrition & Chilled Dairy Plants. This is one of the top scores any factory received in
Nestlé Zone Asia Oceana & Africa (Zone AOA). Sheikhupura next step is to expand NCE foundations
to rest of the factory and be part of first LEAN pilot in Chilled Dairy Value Stream.
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Supply Chain
Supply Chain, despite the challenges in 2010 due to floods and socio-economic conditions, has
successfully managed a fleet of 800 vehicles to collect, and deliver over 1.2 million tons of fresh milk
and finished products to 70 cities across Pakistan without a fatality on the road. In addition to this, we
have also managed to ensure smooth and timely supply of materials and services to our factories.
This is indeed a solid achievement for a complex operation like ours. Additionally, the Supply chain
function extended good support to the flood relief activities by engaging it’s staff and transport
tankers for the relief activities.
A number of good initiatives were taken and implemented for continuous excellence and improving
processes, and with due commitment and dedication of our Supply Chain team, the company
operations were able to improve efficiencies and reduce our cost in a number of areas.
One milestone that is of special significance is the successful completion of “Safar Bakhair” project,
aimed at transformation of our fresh milk transport fleet. This project has also helped Nestlé Pakistan
win Nestlé’s Global “Safety at Work” Gold Award for Safe Driving in 2010.
Procurement (Responsible Sourcing)
In 2008, Nestlé globally launched the Supplier Code initiative involving the Procurement function.
Nestlé Pakistan was selected as one of the 20 Pilot markets for implementing Responsible Sourcing
and Packages Limited was selected as our first supplier. Responsible Sourcing is the process of
purchasing goods and services, which are.
• produced or provided in conditions that do not cause harm to humans, animals or the natural
environment.
• from suppliers that meet minimum requirements regarding business integrity, labor conditions,
health and safety and environmental standards in their business activities, production processes,
service provision and their own purchasing procedures.
This initiative was further introduced to all critical suppliers of Raw, Packaging & Promotional
materials. During 2009 & 2010 awareness, sessions were held with these suppliers to ensure that
they understand the requirements and become fully compliant with the underlying principles of the
Supplier Code.
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It is a source of great pride that not a single Pakistani supplier rejected the Supplier Code and all
acknowledged and embraced the benefits. In 2010, most of our critical suppliers have passed
through the Self Assessment Questionnaire and 6 have been audited and
Declared compliant by 3rd party Auditors. Further details on Responsible Sourcing initiative are
available on www.nestle. Com/suppliers.
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Marketing Communication
It all starts with the consumer and/or customer. Deep understanding and a feel of our consumers is at
the heart of all we do at Nestlé Pakistan. It is the basis of our product innovation/renovation efforts,
marketing strategies and communication platforms. The Consumer Insight & Market Research
(CIMR) Unit plays a key role of being a strong service pillar to the various Businesses. Other than
assisting Businesses in getting required formal researches, it organized 252 consumer connects /
home visits for the Nestlé business and research teams, and our creative agency partners allowing
them to gain invaluable “feel” of our consumers. NESCAFÉ had a breakthrough with a detailed
consumer segmentation and strong insight forming the basis of future business growth and strategy.
Additionally consumer research played a key role in defining the ideal cup of coffee (milky, creamy,
&frothy) keeping in mind the taste palate of the Pakistani consumer.
The Culinary Business continued it’s consumer insight driven portfolio expansion strategy with the
launch of MAGGI Umda
Maza. The Strategic Media Unit, utilizing the learning’s on the consumer, assisted Businesses to
transform that into effective communication to our consumers and customers. Important to mention
here that we continued to ensure that all our consumer communications are in line with local and
global best practices as well as Nestlé’ own policies & guidelines. In doing so, utmost care is taken to
ensure that our advertising campaigns are responsible, ethical, in good taste and do not mislead the
consumer, while staying true to brand values & consumer needs. Our policy on Marketing to Children
warrants special mention, whereby we do not conduct any marketing activity, including advertising,
directly targeting children under 6. Also, direct contact is avoided with older children too so that
parental authority is not undermined.
As the consumers take more control of their own media choices and adapt to new technology and
trends – Internet and Mobile have become extremely important media to communicate with
consumers. With an estimated 18 million Internet users and 60 million Mobile Users in the country,
Nestlé Pakistan has been at the forefront of Digital Marketing, being the only FMCG this active on
Social Networks in Pakistan. In 2010, Nestlé talked to 280,000 consumers through Face book, You
Tube and Twitter through 3 brands (FRUITA VITALS, MAGGI, and NESVITA).
In addition to using, traditional and Digital touch points to reach our consumers; our Consumer
Services Unit is dedicated to establishing direct consumer contacts with a cross section of SECs. The
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aim is to engage and educate consumers, build two-way communication and be part of their
everyday life. The education is specified to basic nutrition, health, and wellness, identification of
health needs, along with generating
Awareness on Nestlé’ product portfolio that meets those needs. These activations are conducted
through road shows and in house sessions at various educational institutes, professional universities
and community centers.
In 2010, we successfully carried out activities reaching over 373,000 consumers. To us it is extremely
important to listen to our consumer feedback and suggestions. To encourage more of our consumers
to more frequently get in touch with us we introduced in 2010 our toll free number 0800
62282(NAATA) through our outsourced call center. Nestlé NAATA, a one-stop solution has evolved
for the consumers of today –enabling them to connect and engage with us more frequently – creating
a bond and endearing the people of Pakistan to us. Through personalized calls to every complainant,
alignment of all key stakeholders to one shared goal – maximization of consumer delight – a strong
foundation of “care” has been set. This is a gateway to bridge the gap between us and our
consumers – addressing their complaints, answering their queries, and hearing their suggestions –
providing a human, caring interface each time.
Management TIMES
Topic
Managing, Decision Making and Problem Solving
Topic out line
1) The nature of decision making2) Rational Perspectives on decision making3) Behavioral Aspect of Decision Making4) Group and Team Decision Making in Organization
The nature of decision-making.
The act of choosing one alternative from among a set of alternatives.
Decision making can refer to either a specific act or a general process. Making a decision implies that there are alternative choices to be considered, and in such a case we want not only to identify as many of these alternatives as possible but to choose the one that (1) has the highest probability of success or effectiveness and (2) best fits with our goals, desires, lifestyle, values, and so on.
Decision making is the process of sufficiently reducing uncertainty and doubt about alternatives to allow a reasonable choice to be made from among them. This definition stresses the information-gathering function of decision making. It should be noted here that uncertainty is reduced rather than eliminated. Very few decisions are made with absolute certainty because complete knowledge about all the alternatives is seldom possible. Thus, every decision involves a certain amount of risk. If there
is no uncertainty, you do not have a decision; you have an algorithm--a set of steps or a recipe that is followed to bring about a fixed result.
Decision-Making Process
– The process of recognizing and defining the nature of a decision situation, identifying alternatives, choosing the “best” alternative, and putting it into practice.
– An effective decision is one that optimizes some set of factors such as profits, sales, employee welfare, and market share.
– Managers make decisions about both problems and opportunities.
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Types of Decisions
Programmed Decisions
– A decision that is a fairly structured decision or recurs with some frequency or both.
• Example: Starting your car in the morning.
Nonprogrammed decisions
– A decision that is relatively unstructured and occurs much less often a programmed decision.
• Example: Choosing a vacation destination.
Decision-Making Conditions
Decision Making Under Certainty
• A condition in which the decision maker knows with reasonable certainty what the alternatives are and what conditions are associated with each alternative.
• Decision Making Under Risk• A condition in which the availability of each alternative and its potential payoffs and costs are
all associated with risks.• Decision Making Under Uncertainty• A condition in which the decision maker does not know all the alternatives, the risks
associated with each, or the consequences of each alternative.
Level of ambiguity and chances of making a bad decision
Lower
Higher
Moderate
Certainty
Uncertainty
Risk
The decisionMaker facesConditions of...
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Problem Analysis vs. Decision Making.
It is important to differentiate between problem analysis and decision making. The concepts are
completely separate from one another. Problem analysis must be done first, then the information
gathered in that process may be used towards decision making.
Problem Analysis
• Analyze performance, what should the results be against what they actually are.
• Problems are merely deviations from performance standards.
• Problem must be precisely identified and described.
• Problems are caused by some change from a distinctive feature.
• Something can always be used to distinguish between what has and hasn't been effected by a
cause.
• Causes to problems can be deducted from relevant changes found in analyzing the problem.
• Most likely cause to a problem is the one that exactly explains all the facts Decision Making.
• Objectives must first be established Objectives must be classified and placed in order of
importance Alternative actions must be developed.
• The alternative must be evaluated against all the objectives
• The alternative that is able to achieve all the objectives is the tentative decision.
• The tentative decision is evaluated for more possible consequences.
• The decisive actions are taken, and additional actions are taken to prevent any adverse
consequences from becoming problems and starting both systems (problem analysis and
decision making) all over again.
• There are steps that are generally followed that result in a decision model that can be used to
determine an optimal production plan.
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The Classical Model of Decision Making
The Classical Model of Decision Making is a prescriptive apporach that tells managers how they should make decision: assumes that managers are logical and rational and that their decision will be in the best interst of the organization.
• Decision Makers have complete information about the decision situation and possible alternatives.
• They can effectly eliminate uncertanty to achieve a decision condition of certainty.• They evaluate all aspect of the decision situation logically.
Steps in the Rational Decision-Making Process
I.I. Recognizing and defining the decision situation
Some stimulus indicates that a decision must be made. The stimulus may be positive or negative.for example, A plant manager sees that employee turnover has increased by 5 percent.
II.II. Identifying alternatives
Both obvious and creative alternatives are desired. In general, the more important the decision, the more alternatives should be considered.For example, The plant manager can increase wages, increase benefits, or change hiring standards.
III.III. Evaluating alternatives
Each alternative is evaluated to determine its feasibility, its satisfactoriness, and its consequences. For example, Increasing benefits may not be feasible. Increasing wages and changing hiring standards may satisfy all conditions.
When faced with adecision situation,managers
Should
. . .
. . . and end up with
a decision that bestServes the interestsof the organization.
• Obtain completeand perfect information
• Eliminate uncertainty
• Evaluate everythingRationally and logically
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IV.IV. Selecting the best alternative
Consider all situational factors, and choose the alternative that best fits the manager’s situation. For example, Changing hiring standards will take an extended period of time to cut turnover, so increase wages.
V.V. Implementing the chosen alternative
The chosen alternative is implemented into the organizational system. For example, The plant manager may need permission from corporate headquarters. The human resource department establishes a new wage structure.
VI.VI. Following up and evaluating the results
At some time in the future, the manager should ascertain the extent to which the alternative chosen in step 4 and implemented in step 5 has worked. For example, The plant manager notes that, six months later, turnover has dropped to its previous level.
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Behavioral Aspects of Decision Making
Sometimes when a decision is made with littleregardfor logic, it can still turn out to be correct. An important ingrediant in how these forcese work is a Behavioral Aspects of Decision Making.
The Administrative Model of Decision Making
Administrative model is ac decision making model that argues that decision makers (1) have incomplet and imperfact information, (2) are consterained by bounded rationality, and(3) tend to
satisfied when making decision.
• Bounded Rationality
The concept that decision makers are limited by their values and unconscious reflexes, skills, and habits.
• Satisficing
The tendency to search for alternatives only until one is found that meets some minimum standard of sufficiency to resolve the problem.
• Coalition
A political force in decision making which consists of an informal alliance of individuals or groups formed to achieve a goal.
• Intuition
An innate belief about something without conscious consideration.
• Escalation of Commitment
A decision maker is staying with a decision even when it appears to be wrong.
• Risk Propensity
The extent to which a decision maker is willing to gamble when making a decision.
• Ethics and Decision Making– Individual ethics (personal beliefs about right and wrong behavior) combine with the
organization’s ethics to create managerial ethics.– Components of managerial ethics:
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• Relationships of the firm to employees.• Employees to the firm.• The firm to other economic agents.
Group and Team Decision Making in Organizations
In more & more organization today, important decision are made by group or team rather then
individuals. Example include the executive committee of General Motors and marketing planing
group at dell. Managers have choose whether to have individual or team make a particular
decision.
There are several aspects of group cohesion which have a negative effect on group decision
making and hence on group effectiveness. Risky-shift phenomenon, group polarization, and
group-think are negative aspects of group decision making which have drawn attention.
Group-think is one of the most dangerous traps in our decision making. It's particularly because it
taps into our deep social identification mechanisms - everyone likes to feel part of a group - and
our avoidance of social challenges. But consensus without conflict almost always means that
other viewpoints are being ignored, and the consequences of group-think can be disastrous.
Decision making in social setting
Decision making in groups is sometimes examined separately as process and outcome. Process
refers to the group interactions. Some relevant ideas include coalitions among participants as well as
influence and persuasion. The use of politics is often judged negatively, but it is a useful way to
approach problems when preferences among actors are in conflict, when dependencies exist that
cannot be avoided, when there are no super-ordinate authorities, and when the technical or scientific
merit of the options is ambiguous.
In addition to the different processes involved in making decisions, group decision support systems
(GDSS) may have different decision rules. A decision rule is the GDSS protocol a group uses to
choose among scenario planning alternatives.
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• Gathering involves all participants acknowledging each other's needs and opinions and tends
towards a problem solving approach in which as many needs and opinions as possible can be
satisfied. It allows for multiple outcomes and does not require agreement from some for others
to act.
• Sub-committee involves assigning responsibility for evaluation of a decision to a sub-set of a
larger group, which then comes back to the larger group with recommendations for action.
Using a sub-committee is more common in larger governance groups, such as a legislature.
Sometimes a sub-committee includes those individuals most affected by a decision, although
at other times it is useful for the larger group to have a sub-committee that involves more
neutral participants.
Moral dimension of decision making
The ethical principles of decision making vary considerably. Some common choices of principles and
the methods which seem to match them include:
• The most powerful person/group decides.
• Everyone participates in a certain class of meta-decisions.
• Everyone participates in every decision.
There are many decision making levels having a participation element. A common example is that of
institutions making decisions that affect those for whom they provide. In such cases an understanding
of what participation level is involved becomes crucial to understand the process and power
structures dynamics.
Decision-makers and influencers
In the context of marketing, there is much theory, and even more opinion, expressed about how the
various 'decision-makers' and 'influencers' (those who can only influence, not decide, the final
decision) interact. Large purchasing decisions are frequently taken by groups, rather than individuals,
and the official buyer often does not have authority to make the decision.
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Forms of Group Decision Making
– Interacting groups or teams
• are the most common form of decision-making groups which consists of an
existing group or newly formed team interacting and then making a decision.
– Delphi groups
• are sometimes used for developing a consensus of expert opinion from a panel
of experts who individually contribute through a moderator.
– Nominal groups
• are a structured technique designed to generate creative and innovative ideas
through the individual contributions of alternatives that are winnowed down
through a series of rank-ordering of the alternatives to reach a decision.
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Advantages and Disadvantages of Group and Team Decision
Making
Advantages
• More information and knowledge are available.
• More alternatives are likely to be generated.
• More acceptance of the final decision is likely.
• Enhanced communication of the decision may result.
• Better decisions generally emerge.
Disadvantages
• The process takes longer than individual decision making, so it is costlier.
• Compromise decisions resulting from indecisiveness may emerge.
• One person may dominate the group.
• Groupthink may occur.
Managing Group and Team Decision-Making Processes
• Managers Can Promote the Effectiveness of Group and Team Decision
Making
– Being aware of the pros and cons of having a group or team make a decision.
– Setting deadlines for when decisions must be made.
– Avoid problems with dominance by managing group membership.
– Have each group member individually critically evaluate all alternatives.
– As a manager, do not make your position known too early.
– Appoint a group member to be a “devil’s advocate.”
– Hold a follow-up meeting to recheck the decision.
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Decision Making in Nestle:
Nestlé is as decentralized as possible, within the framework imposed by fundamental policy and
strategy decisions requiring increasing flexibility. Operational efficiencies, as well as the group-wide
need for alignment and people development, may also set limits to decentralization. Decentralization:
Nestlé recognizes that its consumers have a sincere and legitimate interest in the behavior, beliefs
and actions of the Company behind brands in which they place their trust and that without its
consumers the Company would not exist. Nestlé believes that, as a general rule, legislation is the
most effective safeguard of responsible conduct, although in certain areas, additional guidance to
staff in the form of voluntary business principles is beneficial in order to ensure that the highest
standards are met throughout the organization. Nestlé is conscious of the fact that the success of a
corporation is a reflection of the professionalism, conduct and the responsible attitude of its
management and employees. Therefore recruitment of the right people and ongoing training and
development are crucial. Nestlé continues to maintain its commitment to follow and respect all
applicable local laws in each of its transparent performance appraisal systems and the freedom given
to those to question their seniors benefit not only the employees but even the organization as well.
CHALLENGES TO DECISION MAKING TEAMS
Strategic decision makers regularly use teams to solve urgent problems such as in the drug wars
where both civil and military assets, and federal and state resources are jointly employed. Most
strategic-level decision-making teams exist for brief periods to resolve a major problem or to develop
national policy and strategies to meet future challenges. While these teams carry great
responsibilities, they are often "ad hoc" in nature.
STRATEGIC LEADERS AND TEAMS
Why be concerned about consensus team decision making at the strategic level? What is so
important about that approach to policy making? Consensus decision making offers the benefit of
using more fully the experience, judgment, perceptions, and thinking of a team of people. To those
who have not participated in consensus decision making, the process may seem frustrating. But,
mastery of small group consensus decision making processes may be the key to achieving a
successful resolution of whatever crisis appears in this complex environment. Because of the nature
of modern issues in the global environment, strategic decision makers must rely on teams to solve
problems and to make policy recommendations. A high performing team can be a positive force in
assessing strategic situations and formulating national policy.
LONG-TERM VISION. Effective strategic leaders employ a strategic team to help them in the
visioning process. This team "sees" the strategic environment from various frames of reference,
visualizing the effectiveness of proposed strategies over time. Teams help leaders to understand a
complex situation and gain insight into how to achieve long-term objectives, allocate resources and
integrate operational and tactical decisions into strategic plans.
CONSENSUS STYLE. Effective strategic leaders know how to get everyone involved in policy
making and build consensus in the process. Within large complex organizations, whether public or
private, consensus is the engine that sustains policy decisions. No strategic leader can succeed
unless he or she can build such consensus. Thus, the search for consensus among peers, allies, and
even competitors becomes a requirement for shared commitment to a national policy, and to
corporate, business policy.
TEAM BUILDING. Successful strategic leaders use their knowledge and skills to structure and lead
high performing teams. Strategic teams that perform with unity of purpose contribute to the creation
of strategic vision, develop long-range plans, implement strategy, access resources, and manage the
implementation of national policy. Given the nature of the strategic environment and the complexity of
both national and global issues, strategic leaders must use teams. They cannot do it alone.
Common observations of the strategic decision making process that contribute to the leadership challenge include:
• Diverse Team Membership. There are often several agencies involved, each having
different terminology, goals, and priorities. Members may lack understanding of various
agency roles and contributions to the issues. And, members have different perceptions about
how the government works.
• Lack of Policy Guidance. Strategic-level decision-making teams often are not given
clearly defined policy guidance from above due to politics or concerns about media scrutiny.
This often leads to involvement in undesirable arenas.
• Low Team Authority. The framework for getting things done is either ambiguous or
nonexistent. Nobody is in charge of the process. The "lead agency" concept is confusing and
agencies are designated without specific guidance. Standard military formats and structures
are not useful.
• Internal Politics. Bureaucratic bias impedes team performance. Team member mindsets
emphasize agency goals and programs at the expense of overall government objectives.
There is a strong preference for agency autonomy due to narrow budget constraints and rigid
resource controls. A powerful bias against adapting and integrating operations precludes
coordinated implementation.
• Organizational Inertia. There is strong inertia toward familiar situation assessments and
courses of action. Members resist change or divergence from existing policies.
• Lack of Integration. Sub-groups produce uncoordinated products because they work in
parallel, even when dealing with sequential tasks. There is no coordination mechanism to
integrate subgroup work while in development. In the end, the team staples together
disconnected subgroup products for implementation.
• Gaps and Ambiguities. In interagency teams, the economic component and the private
sector often have no spokespersons. The resource dimension security is often lacking, and
team assessments in this area are absent, weak, or wrong.
Observations & Findings
Nestlé is the pioneer company in introducing several products in this country. It is a leading
Multinational Corporation. Upon studying its operating practices, we concluded that many of the
principles that we studied in class have been applied by Nestlé.
However, the efficacy of these principles is completely dependent on the way in which they are
implemented and the context in which they are applied. Nestlé managers have carefully evaluated
their environment, the challenges they are facing and the situation they are in, and then they have
chosen the practices they employ.
For example, for many companies, matrix organization presents the solution to integrating the
product departmentalization and the cost savings ensured by the functional approach.
However, Nestlé has implemented the matrix successfully by having several liaisons and
coordinating officers in between such as its Business Partners and Category Managers. Similarly
they have also implemented the performance appraisal system effectively tread its full benefits.
It is for this reason that today Nestlé is the fastest growing company in Pakistan today, and more is
on its way as it aims to achieve the Rs. 100 billion mark by 2014. It can continue to expand by
employing its favorite principles of innovation, research, introducing new products, exploring new and
finer market segments, and venturing into unknown territories. Further diversification and introduction
of greater value added products will help it realize its ambitious goals.
Interview with the Human Resource Manager
Name: Uzma Qaiser Butt:
Human Resource Manager-Commercial Tasks and Responsibilities of
the Manager.
Chain of command and Span of control
Uzma Qaiser is a two boss manager in the matrix structure. He has a
dual chain of command and reports to the Head of Human Resource
Department and the Head of Sales Department. Two people report directly to him. He also shares
targets with the recruitment centre and can be held accountable for its actions. He comes to the
forefronts the first line of contact person for the Shared Services and recruitment.
Strategic Vs Operational Roles
She is more involved in strategic decision making as opposed to making tactical and operational
decisions. His role can be interpreted as a link between the departments and the centre.
The Human Resource Department is responsible for providing tools, processes and procedures to
the managers and then it’s their responsibility to apply it according to the demand of the situation. He
ensures those tools are being used and implemented effectively.
Ensuring Coordination & Integration
Different departments come up with different plans which need to be evaluated not only on terms of
finance but also in terms of the business entity as a whole. This places a lot of emphasis on the
decision making ability of Mr. Janjua. Authority is delegated so that others are involved in making
changes and plans but he has to remain involved at all times with the concerned department. He has
to remain continuously in touch with the departments and has to remain updated about their future
growth objectives. Communication has to be ensured on a regular basis.
Observations & Evaluations
It can be evaluated from his interview that he has the legitimate power and a direction to ensure
coordination and consistency in the organization. He has to optimize and maintain balance. He can
be referred to as following a middle of the road management system to keep a balance between
control and delegation. His functions basically include decision making and planning (to evaluate
plans), leading (to ensure motivation and good communication) and controlling. As he can be seen as
a middle manger, human skills are important for motivating, Conceptual skills are necessary to
ensure consistency between objectives of different departments and the organization as a whole and
some technical skills to provide guidance when needed.
Interview with the Category Manager
Name: Fuad Ghazanfar Saqib Designation: Category Manager
Tasks and Responsibilities of the Manager
The Category Manager’s job is a transitional one. He identifies different channels and shoppers (who
ultimately purchase the product). Nestlé Dairy provides its products to approximately 270,000 shops
within Pakistan alone. There are 8-9 channels through which products are provided to customers:
• Large groceries
• Super markets
• Small stores
• Khokhas (cigarette/ pan shops)
• Bakeries14
• Pharmacies
• Wholesalers
Market Research
Mr. Saqib’s job description also requires him to carry out market research on a regular basis. This
helps in identifying the changing consumer demands and tastes. This also enables the company to
review their strategy so that it synchronizes with the company’s goals and objectives. In this era of
fast changing trends it has become almost impossible for an organization to survive without being
aware of the consumers’ needs. Market research helps to serve the organization’s purpose in this
regard.
Shopper Segmentation
An interesting task that is performed by the Category Manager is to analyze the
shopper segmentation i.e. evaluating various customers according to their status, nutritional needs,
age, gender etc and which channel are they prone to buy from. For instance, a huge percentage of
population buying from the grocery stores such as H. Karim Buksh and Al-Fattah are working
mothers. Thus products that cater to the needs of working mothers should be distributed to various
grocery stores. Moreover, keeping in view the shorts helve life of dairy products it becomes vital to
distribute appropriate products to each channel, which meet the needs of each channel’s ultimate
consumers.
He says,The strategy is not to find the solution to the problem but to find the person who has the
solution. The idea is then to sit down and come to a mutual decision on how to go about solving it.
One should have an open mind…the fault can be at your own end too.’
Observations & Evaluations
The Category Manager is not directly involved in the planning management function. Though he is
involved in collecting data that helps develop strategic plans but his role in the planning function is
limited. The Category Manager’s role as an organizer is essential. He needs to allocate human
adnoun-human resources to various channels. To ensure that no stock outs occur he needs to
arrange his resources in a manner so that each product is available at each channel. Moreover, an
excellent coordinator and communicator are essentials of a Category Manager. He coordinates with
the sales, finance and the marketing department constantly. Moreover, to ensure that everything is
running smoothly at each channel he needs to maintain regular contact with the relevant person at
each channel. Since there are not much people working under Mr. Saqib, the leading management
function doesn’t really come into play.
Questions
REFERENCES I have collected all the data from the following sources,
• www.nestle.com • http://www.nestle.pk/index/contact-us.aspx • http://www.nestle.pk/index/milk-collection-system.aspx• By communicating with the employees