Class Presentation

1. Nestlé
Presentation
Aslı Bildik
Melih Zeren
Hanife Armut
İlkan Genç
Deniz Niyazi

2. Industry Analysis
Food Processing Industry
Cannery
Meat Processing
Packaging
etc.
From raw to processed
foods
Lengthening shelf life
Hygiene and health
standards
Big market with major
rivals
•Intense competition
Dieting & Obesity
Allergens
Quality Ingredients
Increasing demand for
Organic/Health Products

3. Nestlé
Products are sold to
wholesalers or retailers
for distribution
End consumers
aimed(Individuals)
Economics of scale is a
good advantage
Core competency for
Nestlé:
Health, Nutrition &
Wellness
“Good food good life”
Largest food
company in the
world

4. Nestlé
Corporate and
organizational culture

5. - Different stakeholders’ expectations and interactions with
the company and with each other shape the culture of
Nestlé.
- Fairness, honesty and concern for people
- Respect for diverse cultures, and developing long term
relationships with suppliers and customers.
- Commitment to a strong work ethic,integrity, honesty and
quality

6. NESTLE CULTURE
Flexibility
Clan- family type
(collaborative)
Internal
focus
Adhocracy
(creative)
External
focus
Hierarchy
(controlling)
Market
(competitive)
Stability

7. Creative Culture : -less functional barriers
-team working
-risk taking
-encouraging innovation and flexibility
- employee can take initiative
- opennes and curiosity for market trends
Market Comptitive: - profit-priented business
- expanding market share
-result-oriented and competition
- market research to reduce uncertainty

9. Nestlé Corpoarte Strategy
- Expectations and needs of consumers affect
business strategy and operations
- Strengthening their leadership in the global
market is key element of their corporate
straregy
- series of strategic business units based around
geography and product.
-‘CREATING SHARED VALUE’
-

10. Differentiation Strategy
-renovation and innovation of the Nestlé
product line
ex: FIRST infant formula, Farine Lactée
spread chocolate, Chokella
instant coffee, Nescafé
chocolate powder drink, Nesquik
coffee creamer, Coffee Mate
coffee mix, Nescafé 3 in 1

11. the largest R&D network of any food company in the world;
with 32 R&D centers and over 5,000 people directly involved
in R&D
-
- market resarch to provide deep consumer understanding to
create and deliver products, systems and services that its
competitors cannot
-Nestlé uses product differentiation strategy rather than
cost-leaderhip. Why?
Product Quality and Reputation

12. - the largest R&D network of any food company in the
world; with 32 R&D centers and over 5,000 people directly
involved in R&D
- market resarch to provide deep consumer understanding
to create and deliver products, systems and services that its
competitors cannot
-Nestlé uses product differentiation strategy rather than
cost-leaderhip. Why?
PRODUCT QUALITY AND REPUTATION

13. Acquisitions and joint ventures
• With the increase in competition, Nestlé has had to
both acquire other companies and
be prepared to enter into joint venture
ex: - alliances with Coca Cola and two Chinese
companies(1993)
- Nestlé and L'Oréal have two successful joint
ventures(2009)
-Nestlé and Colgate-Palmolive
Company(2003)

14. MISSION AND VISION
• Mission :
The mission of Nestlé nowadays – “Good Food, Good
Life” – is to provide consumers with the best tasting,
most nutritious choices in a wide range of food and
beverage categories and eating occasions and to put a
strong emphasize that leadership is not just about size;
it is also about behavior and trust earned over a long
period of time by consistently delivering on promises .

15. Vision :
Whether it is in terms of convenience,
health or pleasure, it is committed to
create trustworthy products, systems
and services that contribute to
improving the quality of consumers’
lives.

16. ORGANAZITIONAL STRUCTURE OF
NESTLE

18. GLOBAL NESTLE
• Nestlé has a Board of Directors, led by
Chairman Peter Brabeck-Letmathe, who was
the former Nestlé CEO.
• The Nestlé Group is managed by geographies
(Zones Europe, Americas and
Asia/Oceania/Africa) for most of the food and
beverage business.Globally managed
businesses
• Vertical oraganazition structure

19. - Its global center office is in Switzerland but it is not
Swish company but it is a worldwide company in a
sense that Nestlé has about 250 000 shareholders,
none of whom individually own more than 3% of
the shares

20. NESTLE TURKEY
• the center of Nestle Turkey is in
Maslak,İstanbul.
• Gebze: distributing center
• Karacabey ,Bursa: manufacturing center
• Horizontal oraganazition structure

21. SWOT Chart
Strengths
Weaknesses
Unmatched product and brand portfolio
Inability to provide consistent quality in food products
R&D capabilities
Weak implementation of CSR
Distribution channels and geographic presence
Competency in mergers and acquisitions
Brand reputation valued at $7 billion
Opportunities
Increasing demand for healthier food products
Threats
Food contamination
Acquiring startups specializing in producing well-being products Trend towards healthy eating
Establishing new joint ventures
Growth of private labels
Rising raw food prices

22. High
Many buyers
Substitutes
High
High
Competitive
market
Loyalty
expected but
prices with
quality important
Low
Major Rivals
Huge
industry/market
High costs
Strong brand
name
Medium
Global firm/Easy to access
local suppiers
Quality hard to achieve

23. Suppliers all
over the world
Shareholders
Customers
Distributors
(global-local)
Advertising
Partners
Governments
Quality
products for
food-processing
markets all over
the world.
Loyalty: 1st
End Consumers
Focused on Chocolate Factory in
Quality seekers
“Quality” and Turkey, Private
Not children
“Convenience names(Chokella,
oriented
Damak),Brands
in market”
Health(Nescafe, Nesquick)
concious
5th most loved
Shareholders
New Focus:
“Health
Conciousness”
Producers
 Dairy, grains,
palmoil, cacao,
peanut, nuts,
pistachio, etc.
Main costs:
Distribution
Production with quality
Advertisement
Reailers/
Wholesale
“Bim” issue
Distribution
throughout
country/world
Pricing higher than rivals but not extreme
due to industy and substitutes
Payments from wholesales to
retailers/shopping malls, etc.

24. Nestlé first major multi-national to launch human
rights white paper

25. Social Responsibility
• Nestle’s education programs have reached 9 million people
•Nestle India supports local schools, themaintenance of public parks
and green belts.
•By changing the recipes of its products, it has eliminated
•75,000 tons of trans fat,
•15,000 tons of salt,
•638,000 tons of sugar

26. • Water Education Programme in India,
informed the farmers on the
proper use of water.
• Nestle provides rural farmers with
technical support via Chilli
Farming Project.
A proud farmer from Kelantan, Malaysia, whose chillies
are used in Maggi chilli sauce.

27. Continual improvement of the environmental
performance along the value chain

28. Packaging Source Reduction Program
Shift from corrugated container to shrink film
From twin to single sachet
Reduced cut off length

29. Nestlé tops global corporate responsibility survey
‘Transparency helps us address
problems, and there’s no doubt it
contributes to better interactions
with external stakeholders.’
Janet Voûte, Global Head of Public
Affairs at Nestlé

30. Challenges of Nestlé

31. Large Company
• Has issues about flexibility
• Time lost through decision periods
Solutions:
• Regional management empowerment
• Glocalization

32. Supplier Issues
• Cacao going exstinct in the world
• Natural diseasters such as flood
• Primitive agricultural methods
Solutions:
• Education to farmers
• R&D about seeds and agricultural methods
• Being prepared to crisis

33. Image Problems
• Child Labor Issue
• Suggestion of privatization of water sources
• Working conditions
All above creating a very bad image
Solution:
• Legal issues
• Charity and Social Projects
• PR projects
• Better working conditions througout the world

38. Social Media Usage
• Not much effective in social media
• Losing a channel for customer relationships
• Even not having social media pages is better(!)
Solution:
• Having more appropriate social media usage

39. Sources
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http://blsciblogs.baruch.cuny.edu/mgt4880nestle/2013/04/03/nestle-industryanalysis/
http://www.slideshare.net/arif587/management-of-change-a-study-of-problemand-challenges-in-nestle
http://blogs.position2.com/nestles-pr-crisis-management-nightmare
articles.castelarhost.comhttp://www.nestle.co.uk/
manuscriptservices.co.uk/extras/examples/nestle.pdf
http://www.nestle.com/
http://www.rankia.com/blog/mundodelaempresa/1110186-empresas-nestlefeeds-the-world-in-english
http://en.wikipedia.org/wiki/Nestl%C3%A9
http://businesscasestudies.co.uk/nestle/doing-better-by-the-environment/waysin-which-nestle-is-doing-better-by-the-environment.html#axzz2oQrqLiZX

40. Thanks for Watching!