Presentation on

Organisation structure of Nestle

By Namrata .M.Kamble Roll no.21 Gahlot Institute of Management

Organizational Structures
An organizational structure is a network of formal

authority, responsibility & reporting relationships. It is an instrument for implementation of organizations strategy. A good organization structure provides the foundation for an effective control system. It can not remain static The structure of any organization depends upon the nature of business, its size & complexity, inter functional relations & extent of control needed.

Company profile
Largest Food & Beverage company in the world.
One of the oldest of all the multinational companies. Estimated 8500 brands manufactured around the

world. 10,000 different products in 500 factories in 83 countries Market its products around 130 countries around the world with annual revenue of 71 billion (2007). Invest around 750 million in R&D every year.

Profile
From Food Technologists who bring product ideas to

life to Sales Representatives who bring our products to our customers, everyone at Nestl shares our core values and plays a key role in moving the company forward. As a worldwide leader in health science nutrition, Nestl is committed to meeting our consumers nutritional needs. Nestle operate the worlds largest private nutrition R&D organization composed of approximately 5,000 employees and more than 20 research centres.

Top Competitors
ConAgra Foods, Inc. Kraft Foods

Functional Organization
The departments are organized according to the functions

performed in the organization. Each manager is responsible for a function such as Marketing, I.T, Operations, H.R. Finance, R & D etc. as shown in the diagram. These functions or departments are staffed by specialists who are expected to be experts in their respective fields. They are headed by responsible people who possess specialized knowledge, qualifications, expertise, skills essential to run such departments.

Chairman P.Brabeck CEO P.Bulcke Innovation R&D W.Beur

Operations J.Lopez

Finance W.L.Martello

Marketing P.Bula

HR J.M.Duvoisin

Nestle waters

Nestle nutrition

Nestle professional

Zone Europe L.Freixe

Asia pacific N.Nandkishore

America C.Johnson

Nestle leaders
Peter Brabeck- Nestl Chairman and
Paul Bulcke, Nestl Chief Executive Officer (CEO). Nestl has a Board of Directors, led by our Chairman

Peter Brabeck-who was the former Nestl CEO. There are 14 members of the Board of Directors. The day-to-day management of the Nestl business is taken care of by our Executive Board. The 13 designated Board Members manage diverse parts of the global business

Structure
The Nestl Group is managed by geographies (Zones

Europe, Americas and Asia/Oceania/Africa) for most of the food and beverage business, with the exceptions of our globally managed businesses, which include Nestl Waters Nestl Nutrition Nestl Professional and Nestl Health Science.

Advantages
Functional organization leads to division of labor &

specialization . Each specialized function has potential to operate with great efficiency & advantage. Efficiency can increase further as the size of activities grows . Economics of scale allow utilization of increasingly specialized inputs & quality of service.

Advantages
Ability to react quickly according to the market

conditions. In 1999 in India, quickly reformulated the Noodles recipe according to local environment. Tailoring of products according to Regional market All Nestle products are certified in Middle East and other Muslim countries. Standardisation of practices and products. All Nestle managers are expected to follow The basic Nestle management and leadership principle document issued by Head office.

Advantages
Good coordination between various divisions bringing

in more efficient use of resources Nestle (UK) able to launch curry products in UK by using expertise of Nestle (India)

Limitations
Primarily this structure is suitable for single industry firm.

When product lines are limited & size of the organization is medium or small, it is quite effective. Performance evaluation of separate functional managers also poses problem because all functional managers are collectively involved in achieving the goals of the organization. High Administrative Cost Lack of effective Communication