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Nescafe Today And Introduction Of The Company Commerce Essay

Paper Type: Free Essay Subject: Commerce
Wordcount: 4215 words Published: 1st Jan 2015

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In the following assignment I will be talking about Nestlé’s background, vision and mission statement, objectives, business strategy, marketing position, competitors, SHRM at Nestle/my view, Nestlé’s 3 HR policies and my views/recommendations, changing role of HR Managers, and finally my conclusion and recommendations.

2. Nescafe Today and Introduction of the company

At current time Nestle is one of the world’s leading Food Company, with its headquarters based in Switzerland. Till moment company has more than 280,000 employees and has over 500 factories in 86 countries. Its major market segments are Africa, America, Asia, Europe, and Oceania from where it generates huge profits.

Its main motive now is to setup factories locally wherever it can, and then hire local employees. It also tends to rely on local resources and raw material. Therefore, a lot of attention is paid towards its professional training and its social environment.

Nestle was founded in 1866 in Vevey, Switzerland, and is a public own company. The company has over 250,000 shareholders and out of those no one owns more than 3% of the stock. Only 1.5% of its profit is generated from its homeland, and rest is from the other 12 factories that it has overseas.

Nestle is known for its wide range of products, such as; baby food, dairy product, beverages, pet care, ice-creams, and pharmaceuticals products, etc (Nestle 2010). With the help to all these products it covers a vast market and therefore, provides its shareholders with a long term profitable growth.

3. Nestlé’s Vision

To keep its consumer satisfied, by providing them with best high quality food, and dairy product.

4. Nestlé’s Mission

The foremost motive is to keep its customer happy by making products as per to the individual taste, lifestyle, and needs which is good for health.

5. Objective of Nestle

Want to sustain its long term image by manufacturing and marketing its Company’s products in such a ways, which links with its customer needs and lifestyle.

Turning short term profit into long term.

Want to carry on its trust and brand image in customer and employee mind by looking after their values and beliefs.

To recruit the right person for the right job, because professionalism is very much required to survive in today’s competitive world.

6. Business Strategies

6.1 Corporate Level Strategies

Improve its product’s growth through renovation and innovation in process and technology.

Want Long term potential

Business should be done by holding on to the values and management principles of the organization.

Build its organization on the basis of human values and principles (Scribd 2010).

6.2 Business Level Strategies

To provide low cost products to its consumers to reduce competition.

Have the concept of Differentiation – By this I mean to reduce the risk of complexity of supply chain and lower attractiveness for discounters.

7. Market Positioning:

Nestle tries to position its product as a superior quality product and consumer focused. Therefore they have this attracting slogans and messages, such as;

“We know your taste better than you”

“Nestle Milk pack is now at your door step”

“Add additional flavors’ to your life”

These all slogans will attract the buyers and would therefore help Nescafe to show its picture clearly and differently. For example, milk pack will position Nescafe’s product on a better platform against the competitors and therefore would gain competitive advantage. Another way of promoting would be displaying their products on the events like Valentine day, Father’s day, Christmas, etc, so that people get familiar with their products.

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8. Competitors

In todays time any company that runs a business face competition in this competitive market. Nestle is a multinational company, and therefore has a competitor as well in this global market. A main competitor of Nestle at this time is Kraft, which has recently taken over Europe’s No.1 Cadbury Company also. Besides this there are other competitors like; Mars (in chocolate), Dannon and Yoplait (in yogurt), General Mills (in flour), etc (Castelar Articles 2005).

9. SHRM at Nestle


Nestle is a human Company and I can say this because they pay special attention to the individual needs of their customer and employees. You can see from their attitude and sense of responsibility that how much they are concern for their people. It’s true that Nestle wants to increase its profit, sales, market segment, but not at the cost which would affect the quality life of its consumer and employee.

Whatever Nestle is today, it gives all this credit to its people because without them they wouldn’t have come so far. It’s their peoples’ strength and energy which got them so far, and therefore, people are their real asset. The company has always promoted and encouraged open and active communication among its employees. Therefore taking in mind their employees ideas and discussions, Nestle today has resulted into improved Company overall.

Therefore, Nestle believes in;

– High Performance

– High Involvement &

– High Commitment.

10. My views on Nestlé’s SHRM

According to me I think that Nestle has done a great job in meeting its strategic HRM. This is because Nestle has successfully linked its HRM with its strategic goals and objectives in order to improve its business performance and long-term customer relationship. The company has aligned its HR strategies with its business goals, through which it achieved its core values. It kept its employees and customers satisfied by looking after their needs and requirements. Nestle totally achieved its strategic HRM by meeting its objectives which were;

Market its Company’s products in such a ways, which links with its customer needs and lifestyle.

Turning short term profit into long term.

Wanted customers and employees trust in its brand

To recruit the right person for the right job

Therefore, it’s proved that Nestle did meet its Strategic HRM, but with this it doesn’t mean it stops here. Nestle has to keep on changing its Strategic HRM with the changing time and needs of the customers. And hence it proved that its SHRM is equal to HRM and vice-versa and it both goes together in order for company to succeed and perform better.

11. Nestlé’s HR Practices

Nestle is a company whose HR strategies or practices are developed by keeping in mind the Business objectives of the company and the strategies devised to run the business. The HR strategies are always in alignment with the business goals. Nestle is unique in the sense that it has been able to successfully inculcate its business objective as well as its core values, consistently in its employees day-to-day activities starting from recruitment till continuous performance appraisals. Today, Nestle has one of the most recognized HR functions globally. (Nestle Careers 2002)

Three Nestles’ HR policies that I will be talking about are as follows;


Theory discussed

As per to Drucker the one contribution that manager should make it that he should provide better vision to other, so that they could perform better. So basically main work of manager is to motivate, train, and develop people in through the means of training.

According to Kirkpatrick there are four level of learning evaluation which is through reaction, learning, behavior and finally the result. If you follow these four principles you will get to know how to train your employees and in which field they need improvements in (Business Balls 2009).

Nestlé’s Training and Development process

At Nestle Training and Development is very important, from bottom to top. Everywhere in the world, every company runs its own training and development methods, such as; classroom courses, e-Learning, etc. Therefore, Nestle also got its own training and Development procedure, which is as follows;

Nestle provides the following-

Literacy training-to upgrades essential literacy skills, especially for workers who operate new equipment.

Nestle Apprenticeship Programs.

Local Training Programs-on issues ranging from technical, leadership, and communication and business economics.

My views on Nestles’ Training process

According to me Nestle is not doing a good job in its training and development department, therefore with the changing time it should also be changed and improved. By doing this it will help Nestle to improve their business productivity and growth. Therefore, a special attention should be paid towards the training process of employees, so that the company performs well in the long run.

My recommendations

In today’s time it is very important that training practices should be changed as the business strategy changes. Therefore you should always keep in mind few things when you are developing a training strategy, such as;

Always recognize the skills and abilities needed by employees.

Then have an outline which will describe that how your investment in training will help in meeting business goals.

Finally, execute the plan you made and monitor the progress that it resulted into (tutor2u 2009).

In case of small scale organization, training can be given by a supervisor or a skilled man, whereas in large organizations, there should be a full time training officer on training department for the employees. The training methods that I would recommend for Nestles’ are as follows;

Training – on the job

By this I mean that training should be provided at the work place. For example;

A proper instructions and demonstration should be provided to the trainee regarding their job.

A special coaching should be provided to employee. By this I mean that there should be close working relationship between an experienced employee and the trainee, so that trainee can learn and adapt to new surroundings.

A job rotation should be done regularly. By doing so a trainee will learn and experience different task and activities that are going on in the organization.

Advantages of- on the job training

– It’s very cost effective for the company.

– It seems to be very productive, because while learning they are also working.

– By having someone standing on the top, give employees more confidence, because they know they are doing good job.

Training – off the job

Off the job training means that employees have to take training by staying away from work place. This is a very formal kind of training provided to employees. Off the job training can either be provided by the company’s training department or through external provider. The examples of off the job training are as follows;

First one is Day release. It is when employee has to take some time out from the routine working hours and have to attend training centre

The other one is that you have to take evening classes outside the work premises and hours.

Then you have sandwich courses, where the employee has to spend around 6-9 months in college before joining work.

Advantages of off-the-job training:

– A special outside trainer is appointed by the company, so they save money by not hiring trainer on fixed salary.

– Employee can pay his full attention on training rather than working and getting distracted.

– The employees will get opportunity to meet other business employees who are there to learn the same techniques.


It is one the most effective training skills. In this trainer show trainees how they have to work and perform their task. In some cases trainer should include the trainees in his demonstration so that they could feel and observe the work practically rather than just looking at it.

Therefore, Nestle could provide any of above training options that I have recommended. By doing so, it will improve its productivity, because now employee will better understand their work. As of now they have done proper training in the field they were lacking before.


Theory discussed

According to Sam Paul it is not necessary to do recruiting yourself, either it is better if you higher and external source for recruiting on your behalf. By this you can just give them the structure or guidelines, from which they will choose a candidate for you. This is very time saving and proves to be cheaper most of the times (Free Articles 2010).

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Samta Sharma on the other hand says that recruiting proves to be very costly component for most of the industries. Therefore, company should adapt to online recruitment by installing new software known as resume parser. This software can automatically short list the best candidate needed for that post. After that interview could be arranged. This will save a lot of time and money of the company, because now they don’t have to go through the complete process of recruiting (Amazines 2010).

Nestlé’s Recruitment and Placement process

Nestle has a very outstanding recruitment practices. Nestle, just doesn’t fill jobs, instead they look for the right person for the right job to maintain work efficiency. Nestle works very hard to get the right set of people so that it can survive this tough market competition. (HR resource 2010)

The recruitment process at Nestle is clearly defined according to its business needs which is;

People with qualities like dynamism, realism, pragmatism, hard work, honesty and trustworthiness are looked for.

Match between candidate’s values & company’s culture are recruited.

Recruitment for management levels take place in the head office by top management and all others at the branch level. The existing employees are promoted to higher posts as per the requirements. There are no lateral recruitments. Another source of recruitment is campus placements and human resource consultancies to look for the enthusiastic, motivated and fresh pool of talent.

Decision to hire a candidate is finally taken by HR professionals only and no preference is given to external consultant. This is done to finally have the judgment power in the hands of Company.

Recruitment process is also totally based on hiring and recruitment of people who bring in new ideas.

My Views on Nestles’ Recruitment Process

According to me Nestles’ Recruitment process could be changed or improved in many ways. Nestle do have some good recruitment policies but at the same time it’s old, and to survive in today’s stiff market competition one has to keep updated.

Therefore, I would like to give some recommendations regarding how Nestle can improve its recruitment process.

My Recommendations

Therefore, according to me they should have a totally new recruitment process, which should be like;

The company should first identify the vacancy, under which the requirement should be; what posts to be filled, number of persons required for the post, what duties they have to perform, and finally the qualifications required for hiring.

Should prepare the job description and the person with what kind of skill is required for that job.

Should give advertisement on the TV, Newspaper etc mentioning the skills they looking for.

From the response that came in, Nestle should short list the people who best fit the job description (Recruitment 2007).

Then the company should arrange the interview with the chosen candidates.

Finally they should conduct the interview and get back to them with their final decision.

After this the recruitment process should be immediately followed by the selection process. The employee should be hired based on the requirement, and the formalities should be taken care off.

Recent Trend in Recruitment Nestle should adapt to


It is when the external firm helps the organization by looking for the candidates according the needs and requirement of the organization. So in simple terms outsourcing firm gets the right candidate for the organization as per their needs and requirements. In turns of this, organizations pay huge amount of money to the outsourcing firm for their services. Example of outsourcing process is in the following table;


It is one of the most common techniques applied in today’s business. Poaching means that you can directly buy the person’s talent, rather than developing it from the start in new person. All the skills that you required for the job could be in this person, who is doing the same work in some other reputed company, which could be your competitor. So the question is what can you do to get him? The answer is simple; you could offer him or her attractive and enhanced pay package with extra facilities (like, holiday packages, car, driver, house, etc). This will surely attract him, and he will shake hands with your company. By doing this you have weakened your competitor, and saved training and recruitment cost and time (Articles Base 2008).


In today’s time many big companies use internet for recruitment. Through the means of Internet, company can post its requirement for the vacant job. Then people can send in their CV’s/Resume if they think that they are applicable for the job described. By doing this it saves a lot of time for both candidate and the company. Because now company can just reply or call in the person for interview who they think best met the requirement.


Theory Discussed

According to Stephen Burg it is very important to keep employees satisfied and happy so that they could work efficiently. The organization can do this by providing them with some kinds of rewards such as; appraisal, incentives, promotion, gifts, etc.

According to Daniel it is very important to give rewards and appreciate your employees work, but at the same time it should be related to their performance, and their competitive nature. Company should not just give rewards if the person is just doing his or her job, because they might get lazy and think that they don’t have to work more hard as compare to what they are already doing. Therefore, company should give rewards to those people only who keeps on performing better and are innovative.

Nestlé’s Rewards and Incentives Process

‘Passion to Win’ awards- These quarterly awards have been institutionalized to reward those who over-achieve their targets.

Long-service Awards- To recognize employees who have been with the company for more than 30 years.

‘Nestle Idea Award’- It was found from the correspondent that the company institutes Nestle Idea Award every quarter to recognize and award employees who come up with relevant and innovative ideas which have the potential of being implemented at Nestle.

For all aspects of Reward, Nestle applies the following fundamental principles;

Reward Principles

Performance Driven – The reward is directly related to the performance of the employee. The better the performance, the better the reward is going to be.

Competitive – Nestle benchmark its’ all aspects of Reward to ensure that they offer all their employees a competitive Reward package

Inclusive – The reward program is made so that everybody could see the contribution that employees make for the organization, not just senior managers.

My Views about Nestles’ Rewards and Incentives process

This is the process where I am very satisfied with the Nestles’ rewards and benefits for its employees. But at the same time you could add a lot to what they already have. Therefore, I would like to give just few recommendations on how they can appreciate their employees work with few tips on no-money reward and recognition.

My Recommendations

Besides what Nestle does for it employees it should also provide some kind of extra benefits to them. By this I mean; (Articles 2009)

Benefits should be provided to all employees, with no discrimination such as;

– Leave-Personal & Medical (fixed no. per year)

– Children Education Assistance Scheme

– Provident fund

– Retirement Gratuity Scheme

– Group Insurance & Accidental Insurance Scheme

– Monthly health check-ups & free consultation for self & family etc.

These all things will really motivate employees to do their task better, because now they are more satisfied and think that company treats them as a part and asset of the company rather than just an employee.

12. Recommendations

Hr strategies that Nestle should follow according to me

With the changing time Nestle should practice following HR practices:

Communication Strategy: Nestle should have an effective communication strategy in today’s changing scenario. Therefore, employees should be well trained and educated with the changes in the market and organization. And this can be done by having open-end discussions in meetings.

Effective Training and Development: At Nestle most of the trainings are done by in-house trainers. But with the changing time they should call external trainer for specialized training. Besides this Nestle should also have training abroad program, so that employees get the feel of global market by working outside.

Entrepreneurship strategy: Every employee needs to be an independent entrepreneur, who can generate ideas and bring them to reality by using the existing resources and support of the organization to create innovative and creative products and services.

Recruit purposefully – In today’s time when most of the organizations are firing people you should have more recruitment going on for the search of talented people. So it’s a great time for savvy companies to hire talented people who have been down-sized by other organizations. This will give advantage to Nestle in coming years.

13. Conclusion

Thought Nestle did everything that it could to survive in today’s competitive environment. But this competition will never stop and will get more intense with the time passing by. Therefore, beside my recommendations in its’ HR strategies, it should also pay attention to its VRIO approach). This is the approach which I think is very much required in today’s time and changing environment. It’s because if NESTLE will keep up with its VRIO structure it will be unique and different than others, therefore will face less competition in the market. How can it do this? Answer to this is by maintaining its VRIO (Valuable, Rare, Inimitable, and Organized) structure, which is as follows;


A resource is valuable if it helps the organization meet an external threat or exploit an opportunity. If a resource helps bring about any one of these four things then it is valuable: Efficiency, Innovation, Quality and Customer responsiveness.

Valuable resources of Nestle are:

Human Resources

Brand Name

Research & development processes


A resource is rare simply if it is not widely possessed by other competitors.

Rare Resource of Nestle:

Its uniqueness in Infant food products

Processes and ingredients they use are rare.

A resource is inimitable and non substitutable if it is difficult for another firm to acquire it or a substitute something else in its place. This is probably the toughest criteria to examine because given enough time and money almost ANY resource can be imitated. Therefore, one way to think about this is to compare how long you think it will take for competitors to imitate or substitute something else for that resource and compare it to the useful life of the product.

Inimitable resources of Nestle are:

Corporate Culture

Values followed at Nestle



A resource is organized if the firm is able to actually use it. However, if you analysis does turn up a valuable, rare, and inimitable resource that the firm is not taking advantage of, then the resources of the firm are not said to be organized.


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