Group 7

Shehryar Yousaf 04151913032

Khawaja Ahmed Ismail 04151913018
Mujeeb-ur-Rehman 04151913038
Aqeel Nawaz 04151913013
Hafiz Burhan Munir 04151913037

NBEAC:
(National Business Education Accreditation Council). Functions at the
national level as well as an accreditation authority within its scope to facilitate enhancing
the quality of business education in Pakistan.

QASMS:
Quaid-I-Azam School of Management Sciences.

Vision And Mission:

In the lights of the mission and vision statement of the university, QASMS
has set the following objectives.
• To excel in academics and research while focusing on the current and future
needs of the business and public sector of Pakistan.
• To ensure highest standards of quality in programs and establishing a stable
position in comparison to its competing business schools in the local market
while aligning itself with international standards of education.
• To incorporate changing market requirements in its programs to ensure a
superior job market for its graduates.
• To develop entrepreneurial skills and mindset in business students.
• To enhance students with modern and practical knowledge and guiding them in
the application of theoretical knowledge.

Organization Name: NESTLE

Nestle is a Swiss-German which means “Little Nest” which is its trademark Nestle is the
world’s number food company.5th largest company of the world according to its
turnover 2 million 31 thousand people employed from all over the world. Present in 186
countries of the globe having 522 factories. Over 700 products have been renovated or
innovated in the past five years, with wellness in mind. In the 1860’s Henri Nestle, a
pharmacist, developed food for babies who were unable to breastfeed. His first success
was a premature infant who could not tolerate his mother’s milk or any of the usual
substitutes. High infant mortality rates, and the lack of suitable replacement food for
babies with no access to breast milk, were the motivation behind Henri Nestle's
invention of Farine Lactee. He was also able to offer his food to convalescent and
elderly people, thus laying the foundation of the concept of today’s nutrition.

Organizational structure of the nestle is hierarchical.

Organizational structure is the formal framework by which job tasks are divided,
grouped, and coordinated. Nestle is a function-based organization. The tasks are
divided into separate jobs and then these jobs are grouped together under different
departments i.e. functional departmentalization is found in organization. Each major
area is kept under the manager who is a specialist in that concerned field and is
responsible for all activities, which that department performs.

Board of Directors:
Chairman Mr. Syed Yawar Ali
Managing Director Mr. Bruno Olierhoek
Director Mr. John Davis
Director Mr. Naveed Ahmad Khan
Director Mr. Juan Jose Aranols
Director Mr. Syed Babar Ali
Director Mr. Syed Hyder Ali
Director Mr. John Martin Miller
Director Mr. Osman Khalid Waheed

Management committee:
CEO Mr. Samer Edmond Chedid
Head of Technical Mr. Amr Rehman
Head of supply chain Mr. Ali Akbar
General counsel & company’s secretary Mr. Muhammad Ali Sudozai
Head of corporate affairs Mr. Waqar Ahmad
Head of Human Resource Mr. Akmal Saeed
Head of communication Mr.Faisal Akhtar Rana
Head of finance Mr. Syed Saiful Islam
BEO Nestle water Mr. Khurram Zia
BEO Dairy Mr. Joselito Avancena
BEO Nestle Professionals Mr. Abdullah Jawaid Ahmad
Head of strategy & business develop Ms. Samra Maqbool
BEO Nestle Nutrition Mr. Jamal Khan

Organizational Structure:
Top level Management:
 It contains a 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. Top management broad policies of the enterprise and
lays down the objectives. Issues necessary instructions for preparations of subdivision
procedures, schedules, budgets etc. Prepares strategic policies and plans for the
initiative. Coordinates and controls the activities of all the departments.

Middle level Management:

The branch managers, departmental, marketing,
technical, human resource and finance managers constitute the middle level. They are
responsible to the top management for the operation of their department. They devote
more time to directional and organizational functions. They execute the plans of the
organization in accordance with the policies and directives of the top management.
Understands and explains the policies from top level management to lower level.
Participates in training and employment in lower level management.

Lower level Management:

Lower level is also known as operative/supervisory
level of management. It contains supervisors, superintendent section, national sales
manager, group brand managers, distribution operation officers etc. Assigning jobs and
tasks to various workers. They instruct and guide workers for day-to-day activities.
Responsible for quality as well as the quantity of the production. Maintains good
relations in the organization. Communicate worker’s problems and suggestions to the
higher level and higher-level goals and objectives to the workers.

FAYOL’S 14 PRINCIPLES OF MANAGEMENT:

1- Division of work:
In Nestle every product category has its own infrastructure of
management. Relevant specialized people are working in the relevant departments
according to their skills & specialization so as to increase the efficiencies of work.

Such as the supply chain department looking after the product supply. Finance
department is responsible for the financing activities of the company and so every
department is doing its specialized job or work so that the goals of the company are well
achieved.

2- Authority:
Authority had been given to respective managers of the different
managers like finance, human recourse, & technical managers. So, they have the
authority to take work from the employee’s working under them and give them orders of
how to carry out the work. So, managers are responsible for the work they have taken
from their employers.

3- Discipline:
Nestle is a well-disciplined organization. Every department in a company
follows the rules & regulations of the company. Just like when to arrive at the job, how
to do your job & how to fulfil your responsibility and last at the least how to behave in
the company.

4- Unity of command:
In a particular department like the supply chain department only the
head of the department will give orders to its team as he is the supervisor of the team
the others will not influence in their department. Only he will coordinate with the team
how and when to carry out the distributions of certain products etc.

5- Unity of direction
It's the same as above as in the company each department carries
out its own plan and executes according to the instruction of the head of the
department. That's why Nestle is the leading food company in the world.

6- Subordination of individual interest to general interest:

As per the policy of the company individual
interests are not allowed in the company. Company's interests are more important than
the individual ones.
For example, the strategy plans for the current year revenue generation will remain the
same as per company policies irrespective of the departments or some employees
individual plan.

7- Remuneration:
In Nestle every employee of the company is hefty or well-paid according to
their designation from the head to the distributor, cleaner, guards etc. financial and non-
financial compensation is given to every employee of the company.

8- Centralization:
Nestle is a decentralized organization where responsibility for operating is
given to the local units and they have authority regarding pricing, distribution and
marketing decisions etc. Nestle as a decentralized organization permits subordinate
branches to enjoy a proportionately high-level of independence.

9- Scalar Chain:
In nestle the scalar chain is implemented from board of directors to middle
level management i.e. HR, marketing, distribution & technical managers. And then on to
lower level management that includes supervisors etc. As authority is distributed from
top to bottom and everyone has a specific authority regarding his work.
10- Order:
 In nestle the order is strictly exhibited. The right person is in the right place that
means the qualified person is working for a specific designation, and also the products
of the company are managed in well order as every product is stored according to a
specific order and as specific place. Like baby foods are stored separately from the
juices and other drinks.

11- Equity:
Equity is the main manifesto of the company. As every employee of the company
is treated with kindness irrespective of the designation of the employee. That is why
nestle is progressing at a rapid rate because employees are treated very well and in
return they work for the betterment of the company.

12- Stability of personnel tenure:

Nestle's human resources department provides a great
stability of jobs to its employees. Because At Nestlé, the company recognizes that our
employees are the key to our success and nothing can be achieved without their
engagement The Nestlé policy is to hire employees with personal attitudes and
professional skills enabling them to develop a long-term relationship with the Company.
Therefore, special attention will be paid to ensure there is a strong alignment between a
candidate’s values and the Nestlé culture.

13- Initiative:
Nestle has been involved in many great initiatives regarding nutrition,
water and rural development. In this regard the company has several partnerships with
governments and NGOs. The new initiatives are related to nestle basic business
strategies of health, nutrition and wellness. Creating value for the customers in terms of
basic nutrition, water and food production is the key to nestle building a sustainable
business in the long term.

14- Esprit de corps:

This principle is very well managed in the company. because it's in
the policy of the company that employees in a group should work together in offloading
a specific task. Unity in an organization is very important for the success of the
company. That is why every department or a group in a company works united to fulfil
its duties.

. McGregor’s theory X & Y:

Like in every organization there are positive employees as well as the negative
employees. Same is the case with nestles.
Some of the workers in the lower designations including packaging distribution etc.
need to be controlled by the supervisor to carry out their work effectively because those
workers don't realize their responsibility and need to be supervised or need guidelines
to do their job. These employees lie in the X category.
The employees in the middle of upper level management lie in the Y category. Because
they are self-directed, they are capable of accepting new challenges and they accept
new techniques. They love their job and take their job as natural. They love to accept
responsibility so as to get promotion and show their talent to the boss. They are self-
motivated and have their ambitions and goals. They are capable of making good
decisions that's why they don't need a supervisor to control them. They want to
maximize their potential.

System:
A set of interrelated and interdependent parts arranged in a manner that produces a
unified whole.
Example:
Consumer expectations, competition, trade landscapes and society are all evolving at
an unprecedented pace. Our company must respond to deliver good food in ever more relevant,
accessible and sustainable ways. Every choice we make reflects our commitment to deliver Good
food, Good life. Good is about holding ourselves to high standards and always striving to be
better.
*In Nestle:
Different departments like finance , HR , Quality, Operational.
All department work separately but also interrelate with others Main purpose achieved company
goal.

Open And Closed systems:

Nestle as an Open system:
Nestle is predominantly an open system. Company largely
interacts with its environment because as a large food chain company , it interacts with
the customers to know their desires about the flavors/ new products and also get the
feedback of their products to make it better from time to time. Also, it interacts with the
environment in selling its products to customers to generate its revenue. Nestle also
keeps in mind the factors that disturb the environmental balance i.e. they make sure to
use such substances in their packaging materials that less affect the environment.

Nestle as a Closed system:

Nestle is a closed system in a manner of management
operations. As in management meetings the decisions or strategies made for the
betterment of the company or to enhance the financial status of the company are kept
confidential. They are not disclosed in public. Also the Research and development
department of the company which has been responsible for the new innovations of
products for the company, is also kept confidential because of the company
competitors as they are widely interested in companies new policies & products to keep
up with them.
 Environment:

Definition:
The environment of system is a set of elements and their relevant properties, which
elements are not the part of the system but change in any of them can change the state
of system.

Environment in Nestle:
To ensure we implement the Nestlé Policy on Environmental Sustainability, we have
robust governance and management systems, policies and standards in place. These
are regularly reviewed and verified by independent organizations to ensure they align
with international and national regulations and guidelines.

Example:
AS the World Food Company, Nestlé is dedicated to providing consumers with
the best food throughout life.

Task environment:
Affects its ability to reach business goals. Any business or consumer with direct
involvement with an organization may be part of the task environment. Examples of task
environment sectors include competitors, customers, suppliers and labor supply.

Mega environment:
A mega-environment (ME) is defined as a group of environments that share the same
(type of) winning varieties. A meaningful ME should be a group of locations that
consistently share the same (or similar) winning varieties.

Culture:
Cultural management includes the planning, processing, monitoring, and controlling of
management functions in an international and cross-cultural conte.

Culture in Nestle:
Organizational Culture of Nestle: Nestle has strong corporate culture which is reflected
by the company logo itself. The logo, “Good Food Good Life” which is always attached
to its products is the main guidance for every activity within the company. The company
culture which is related its people structure.

Example:
Performance Through Culture At Nestlé USA, you have the opportunity to
cultivate a career with limitless potential.

Scientific management:
Scientific management is a basically theory of management that seek to improve an
organisation efficiency By it systematically improving the efficiency Of task completion
by utilizing Scientifically engineering and mathematical analysis.

Scientific management in Nestle:

Nestle work with leading technologies and top external partners the provided solution to
enable Nestle to engage with the millions of consumer worldwide.

Example:
Is in today’s days fantastic management is used in all industries Due to Corona in
Nestle also scientific management is used to communicate with customers

Quantitative approach to management:

The quantitative approach involves the use of
quantitative techniques to improve decision making. This this approach has also been
labeled operation research of management science. It includes the application of
statistics, information models, and computer simulations.

In Nestle:
Nestlé's executive information system (EIS) department gathers data from
the firm's subsidiaries (reporting units) to provide top management with operational,
financial, and strategic information. the EIS department decided to improve its service
by using business analytics tools based on management science (MS) techniques. It
wanted to encourage analysts and controllers to make better use of the information
supplied. Nestle developed four modules: sensitivity analysis, forecasting, simulation,
and optimization, and integrated them into a more global modeling scheme for
evaluating the economic profitability of Nestlé's projects and more generally evaluating
the value of the Nestlé group and its multifocal businesses. Disseminating this approach
within the Nestlé group through training and internal consulting has been a long and
important process that has increased the number of managers accustomed to
quantitative decision making and established new reporting protocols imposing the use
of MS models.

For example:
During budgeting of the new fiscal year, the finance department clearly use the
quantitative tools to look which area needs improvement, or which area is lacking
behind. They clearly use the quantitative charts of the last year to ensure the accuracy
of the decisions which they going to take this year while allocating budget. For this there
are many software, which aid in developing models, and equations which are then used
by the managers to in decision making. Similarly, before introducing a new product for a
region, the operation management clearly use quantitative analysis, such as liking of
people, weather of the region, how to insure price for a product etc.

Contingency Approach:
The contingency approach is a management theory that suggests
the most appropriate style of management is dependent on the context of the
situation and that adopting a single, rigid style is inefficient in the long term.

In Nestle:
Nestlé is no exception to this, its 150 years in existence a testament to its success.
During 2015 it is thought that the company sold $90bn worth of goods across almost
200 countries. Others estimate that out of each and every cup of coffee drunk in the
world, Nestlé’s iconic Nescafé can claim ownership to making one in five. For
example, nestle basically starts from the idea of food cereals for the children but later
their management realized the need of other food items for the wellbeing of customers
as well as for the company financial status. So, with the passage of time Nestle
introduced its juices, nectar, and fruit drinks, nestle water and also the dairy products.
So, their management applies changes with time to time so that the company cannot
get stuck. And also, the revenue can be increased in the long term for the company.

Contemporary viewpoints:
Total quality management (TQM):
Approach highlighting collective responsibility for products and
service quality and encouraging individuals to work together to improve quality.

In Nestle:
Quality and Safety of consumers is Nestlé’s top priority. This applies to
company’s entire portfolio, from foods and beverages to all our systems and services.
Quality Management System is the platform that Nestle use globally to guarantee food
safety, compliance with quality standards and to create value for consumers. Our
internal Quality Management System is audited and verified by independent certification
bodies to prove conformity to internal standards, ISO norms, laws, and regulatory
requirements.
For example:
Whenever Nestle is introducing the new products, the company’s Quality management
department ensures the following things:

▪ Build trust by offering products and services that match consumer expectation
and preference
▪ Comply with all internal and external food safety, regulatory and quality
requirements
▪ Gain a zero-defect, no-waste attitude by everyone in our company
▪ Make quality a group-wide objective

Decision making:
is the mental process of choosing from a set of alternatives. Every decision-making
process produces an outcome that might be an action, a recommendation, or an
opinion. Since doing nothing or remaining neutral is usually among the set of options
one chooses from, selecting that course is also making a decision

Decision-making in Nestle
1 Problem recognition
2 Information searches
3 Evolution of alternatives
4 purchase decision
5 Post purchase behavior

Step in Decision Making

Decision making comprises a series of sequential activities that together structure the
process and facilitate its conclusion. These steps are:

Establishing objectives

Classifying and prioritizing objectives

Developing selection criteria

Identifying alternatives
Evaluating alternatives against the selection criteria

Choosing the alternative that best satisfies the selection criteria

Implementing the decision

Programmed decisions:
*problem are routine and repetitive.
*the conditions for programmed decision are highly certain.
*Made by lower level people.
Example: Applying our nutrition expertise ( to enchance the health and wellness of
people and pets).

Non-programmed:
*program are unique and novel.

*the condition for non-programmed decision are highly un certain.

*Top management responsibility.

Example:
To meet the nutritional needs of both affectees and frontline workers during these times,
Nestlé Pakistan has committed 100 million rupees in the national response to the
COVID-19 pandemic. As part of the pledge, Nestlé Pakistan will give product and cash
donations, which will include 4 million servings of milk, iron fortified dairy products, baby
cereals, water and juices.

Emerging views:
E-business:
A company that does all or most of its transactions through the Internet. It is
another term for e-commerce.

How Nestle perform E-Business:

"We are very much in the business of innovation," stated chief financial officer.
The best illustration of this, he said, is "the fact that about 30% of our sales are coming
from products that were not in the market three years ago or that we renovated over the
last three years." For example, Nestle has the official online stores in all the countries
in which it is operating. For example, in Pakistan nestle has collaborated with Daraz.pk
to deliver its products to the customers at their doorstep. So, they don’t have to roam
across the shops to get nestle products.

E-commerce:
All commercial transactions conducted electronically on the Internet.

In Nestle:
Nestle in its annual report revealed that its digital transformation initiatives are reaping
benefits as e-commerce sales grew 18 percent accounting for 7.4 percent of total sales
in 2018. Nestle sales increased 2.1 percent to CHF 91.4 billion in 2018 from
CHF 89.6 billion 2017. The operating profit margin of Nestle reached 17 percent. Nestle
has a strong IT and digital transformation team to look after business efficiency and
growth – driven by technology. For example, Nestle admitted that the rise of digital and
online shopping is changing the retail industry. It is using the opportunities offered by
the digital transformation across marketing, social media, and e-commerce. Nestle aims
to deliver more personalized products, messages, and services directly to consumers.
The company said digital transformation will play an important role in its target to
increase trading operating profit margin from 16 percent in 2016 to between 17.5
percent and 18.5 percent by 2020.

Globalization:
The process by which businesses or other organizations develop
international influence or start operating on an international scale.

Nestle as a globalized organization:

Established over 150 years ago, Nestlé is the world’s largest, most
diversified food and beverages company. Nestle have a unique global footprint and sell
our products in 187 countries worldwide. Through enhancing quality of life and
contributing to a healthier future, Nestle aim to deliver sustainable, industry-leading
financial performance and earn trust.
Corporate Social Responsibility:
Corporate social responsibility (CSR) is a type of business self-regulation with the aim
of being socially accountable. There is no one "right" way companies can practice CSR;
many corporate CSR initiatives strive to positively contribute to the public, the economy
or the environment. In today's socially conscious environment, employees and
customers place a premium on working for and spending their money with businesses
that prioritize CSR.

CSR Examples:
• Corporate policies that benefit the environment.
• Socially and environmentally conscious investments.
• Improving Labor Policies

CSR in NESTLE:
At Nestlé, we believe in the philosophy of Creating Shared Value (CSV). It is our belief
that for a company to be able to create value for its shareholders, it must also create
value for society. Nestlé Pakistan, as part of its global and local obligations, believes in
Creating Shared Value for the communities it works with. The health of our company is
intrinsically linked to the health and resilience of the society we operate in; this is why
Nestlé’s purpose is to enhance quality of life and contribute to a healthier future.
Nestlé promotes nutrition education and physical activities among school children in
rural areas through the Nestlé Healthy Kids (NHK) program and the Knowledge Sharing
(KNHK) program.

SWOT Analysis:
SWOT stands for Strengths, Weaknesses, Opportunities, and Threats, and so a SWOT
Analysis is a technique for assessing these four aspects of your business.
You can use SWOT Analysis to make the most of what you've got, to your
organization's best advantage. And you can reduce the chances of failure, by
understanding what you're lacking, and eliminating hazards that would otherwise catch
you unawares.

NESTLE SWOT Analysis

 Strength and Weaknesses

Strengths Weaknesses

1. Unmatched research and 1. Criticism over high water usage,

development capability selling contaminated food, anti-
unionism, forced child labor and using
2. Strong geographic presence, with
other unethical practices
one of the best geographically
diversified revenue sources 2. Contaminated food recalls
3. Unrivaled product and brand
portfolio
4. Environmental sustainability efforts
5. Ownership of some of the most
recognizable brands in the world

Opportunities:

1. Clear and accurate labelling indicating of any harmful products

2. Transparency in material sourcing
3. Growing number of small Silicon Valley based food startups
4. Growing ready-to-drink (RTD) tea and RTD coffee markets

Threats:
1. Poor quality water and its scarcity
2. Increased competition in the beverage and food industries
3. The price of coffee beans could significantly rise due to major weather disasters