Professional Documents
Culture Documents
Group Members:
Fatima Alibraiem | 2009800025
Zainab AlNasser | 200900165
Manal Alsaif | 200800621
Introduction. ………….………………………………………………………….……………..3
Financial Management………………………………………………………………………15
Organizational Structure…….….………………………………………………….….…..17
External Assessment………………………………………………………………………..20
Strategy formulation………………………………………………………………………..24
BCG matrix………………………………………………………………………..……………27
SPACE matrix………………………………………………………………………………….28
Strategy Implementation………………………………………………………………..29
Executive Summary………………………………………………………………………..35
References……………………………………………………………………………………..38
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Business Description and Vision
Introduction:
This project will attempt to analyze Nestle Company, on many levels. The main
points of concern are to discuss the Nestlé?s mission and vision, conduct both
internal and external assessment of the company, formulate a strategy that is well-
suited to the company's nature, implement it, and finally try to evaluate the
outcome. To better understand the company and all information collected, one
must first introduce it. Nestle was first founded in 1866 by Henri Nestle, and it is
today the largest food and beverage company on an international level. Nestle is
precisely why it is where it is now. Their company grew over the years to include
many products, some of which are chocolates, soups, coffee, cereals, frozen
products, yoghurts, mineral water and other food products. However, by the start
of the 1970's Nestle expanded its product portfolio to include pet foods,
the products it holds, Nestle still maintains its image as a company concerned with
intact. Their main goal is to provide the best and most relevant products to
people, wherever they are, whatever their needs, throughout their lives.
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products differ from one place to another, as the efficacy responsibility and the
and practiced. This approach can be said in different words as 'centralize what
you must, decentralize what you can'. Nestle seek to think about its company
globally, however deal with issues on a local level when interacting with people.
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Mission and Vision
that research can help us make better food so that people live a better life. Good
Food is the primary source of Good Health throughout life. We strive to bring
consumers foods that are safe, of high quality and provide optimal nutrition to
consume, Nestlé helps provide selections for all individual taste and lifestyle
element of our future. We know there is still much to discover about health,
wellness and the role of food in our lives, and we continue to search for answers
to bring consumers Good Food for Good Life?The Mission of Nestle: ?Nestlé
strives to be a leader in nutrition, health and wellness, with the belief that good
food is central to health and wellness. At the Nestlé Research Center, nutrition
research meets food innovation to bring consumers of all ages and stages of life,
foods and beverages that contribute to health and wellness, while offering
world?s first choice provider for foods, beverages, and commodity products.
Providing customers with what they need, when they need it?The improved vision
statement is better in the sense that it is drastically shorter than the original vision
promising consumers all over the world that they will be provided with what they
require in the time they desire. It also shows that the company has ambition, and
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is willing to win over competitors from all over the world.Mission: ?Nestle is
devoted in providing the best quality and value worth product to its customers.
best satisfy people of different tastes and expectations.? The improved mission
statement shows commitment and devotion, and that it does not just stop at that,
but it also shares how the company is functioning and is willing to reach its goals.
different industries, due to the fact that it has a multi product portfolio. However,
P&G vision statement: "Be, and be recognized as, the best consumer products and
service company in the world".P&G mission statement: "We will provide braded
products and services of superior quality and value that improve the lives of the
and vision statement has the advantage of being shorter in length. However, their
vision statement is vague and does not provide the reader or rather the consumer
with the means by which they will accomplish their vision. The mission statement
on the other hand is futuristic while maintaining a present sense of time. It relates
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Description of the Products and Services
Nestlé has some 6,000 brands,[ with a wide range of products and large variety
Competitive Comparison
1/ Unmatched product and brand portfolio
2 /Unmatched research and development (R&D) capability
3/ Unmatched geographic presence
4/ People, culture, values and attitude
Technology
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Nestlé is strengthening its research and development by enlarging its global
consumer insights, and translating these into innovative products and packaging
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Marketing and Sales Strategy
distribution, promotion and price. Nestle main strategy and way of business is to
focus on innovation and renovation while maintaining a balance between the earlier
genuine interest coming from them. They believe that without the customers,
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Nestlé’s Website
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Figure 1
Positive points:
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1. Very accessible, provided tabs help visitors and customers access what they
advertisement.
6. Full information on many topics, supported by charts, tables and graphs.
7. The contact us page is very simple and efficient. It also contains the address
customer may not be aware of a product, thus by seeing it his/her interest will
Negative Points:
to countries who speak French, it changes directly without the consent of the
visitor.
Strengths:
1- Located in over 100 countries. The largest Company in the world for
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3- Professional brands sold to restaurants, colleges, and hotels.
4- Nestle has some very strong brands like Nescafe, Maggi and Cerelec. These
brands are almost generic to their product categories, which are known
globally.
5- Nestle has a worldwide network of centers in 17 locations on four continents.
clinics.
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Weaknesses:
1- Growth in their organic food sales division was slightly low in 2008.
2- Since 2004 the breakfast cereal industry has been under fire from the FDA
and the American Medical Association, both of which say that false claims of
and advertising. They have also been forced to reduce the amount of sugar in
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Financial Management
Profitability Ratios:
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Liquidity Ratios:
Activity Ratios:
Solvency Ratios:
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Organizational Structure of Nestle
distributed into separate jobs, which are later grouped together under different
chart. (Figure 1)
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Figure 2
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The chain of command spreads from the organization’s upper levels to the
lowest levels, clearly showing who is supposed to report to whom. Suggestions move
from downward to upward, while orders move from upward to downward. Thus
encouraging employee to share their opinions and thoughts with their superiors, yet
keeping ordered easy to follow and from a single direction. The nature of job
descriptions are explicit and formalized, procedures and practices are clearly
where departments are divided according to the genre of the product being
manufactured and sold, thus making it relevant and more convenient to manage and
project expectation and goals. In the improved version of the organizational structure
each department or rather facility will work as an individual unit, however they all
must report to the headquarter office with reports that indicated how well they are
doing and what they may be facing. This can implemented on a local level, since
Nestle operates in multiple regions all over the world, it would be better to satisfy
customers to have functions operation under each location’s requirement, while still
into divisions in each zone they operate in. Where every distributor is restricted to
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sell products in the specified region, for instance dividing zones such as: East, West,
take a look on Nestlé’s pure life product, we find that it is targeting customers of any
area, culture, age, gender, beliefs, and income. Nestle believe that everyone
regardless of what or who they are, are capable of drinking its water. Not only does
this apply for water as a specific product, but it is also for all of their other products.
Continuing with the example of the Pure Life product, Nestle attempts to
appeal to its customers in a more healthy way, by trying to promote how its water will
enhance costumers life, and that unlike competitors product, it does not only fulfill
their thirst. They are motivating people to buy the Pure Life product by spreading
ideas such as: Stay Hydrated, drink for health and energy, you are what you drink, be
Apparently Nestle is leader in the market of the water industry. Which shows
how effective their approaches are, and how paying attention the customer needs is
rewarding. Between competitors Nestlé share (in the water industry) is said to be
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External Assessment
Political:
Any political decisions will have an impact on Nestle for the both the good and the
bad. If the tax rate increases, the consumers will reduce and so for the sales of their
stocks.
Nowadays there are different types of consumers and of course the needs of new
It is hard to describe the culture in Nestle. Because they care about their people,
motivate them in different ways, and their way of learning new things from each
other. The demographics around the world is changing now. Therefore the economic
and the geographic factors will affect people and their lifestyles. Nestle will try to
Technology
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Before technology people used to eat only what they harvest and plant themselves.
Now, that is not the case anymore. With technology, more products and food can be
*Since Nestle is a multinational food company with thousands of brand that they
merged with, it is really hard for any company to compete against. However any
company that usually makes package food might be a competitor for Nestle such as
*For the bottled water industry and due to the advancements and changes in
• what divers those out of home snacks is the enjoyment Home (54% and 37%)**
• the need for the deskilled labours using easy to use products
• the need for high quality products for the high skilled people
)Legislation
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Nestle’s Opportunities and threats
Opportunities:
9) They launched a new premium line of higher cacao content chocolates dubbed
consumers cut back on luxury goods, but regularly indulge in candy and chocolate
10) they can introduce more health-based products, and because they are a market
Threats:
competing
3) the fear of the competition of the big discounters such as wall-mart.
4) The bad reaction of the political opposition
5) Threat of organizing
6) The competition from the big world-known food competitors
7) The environment regression
8) The issue of compliances
9) The factors from macroeconomics
10) The claims of illegal business
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External factors Evaluation matrix
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It identifies the opportunities and threats for any company. of course the factors are
rated from 1-4 where 1 the lowest, 4 the highest. Many companies nowadays are
entering the market and putting low prices for their products to attract customers and
Therefore there are opportunities that may help the company which is globalization.
It makes it easier to inter the International markets. Their weighted score is 3 which
might be not really good in addressing their factors in their environment. But in
addressing the weighted score for both the threats and the opportunities, based on the
Strategy formulation
strategies to achieve and produce a reference and supportive explanation that modify
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the mission and vision. Environmental strategy, corporate strategy that includes the
SWOT analysis
Strengths
One of the major strength for Nestle is their CEO peter Barbek, who’s really good and
smart. He always wanted to achieve higher goals which are mostly the internal
targets, and renovate current products and make new products as well. His
explanation of renovation is that “to just keep pace in the industry, you need to change
Weaknesses
Nestle weakness ia actually locaed in France where they didn’t do well as they
expected. Danone had already entered the market with their yogurt which is health-
based yogurt. Another weakness was their organic food sales was not good as
expected either.
Opportunities
One of them is that the world is now are depending more on the health based
products. People around the world are becoming more health conscious. Nestle can
also be one of the biggest companies in Germany. They had captured 60% of the
market in Germany after launching the products there. They are also producing non
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Threats
One of the major threats to Nestle that most markets which Nestle is entering are
already mature markets. Since Danone first established their business in France, and
they are taking the leadership position of yogurt market there. Although people liked
the taste of Nestle yogurt but still the researchers believe that those people never
bought the nestle yigurt again because they liked Danone’s more. Another threat to
Nestle is general Mills, which is the leader in the yogurt market and it is located in the
United States.
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The STAR refers to the high relative market share and high market growth. The
beverages falls in this category. The reason behind that is the high quality of Nestlé’s
beverages and the new ideas that they come u with every now and then. Thos features
make Nestle’s beverages very popular especially for the upper class, because Nestle
The Cash Cow for Nestle is the baby food items. The company is trying to take
DOGS the pharmaceutical products falls in the dogs category because of the low
market share business and the low growth. The company still thinking of how to
Question Mark refers to high market growth and low market share. Breakfast cereals
represent this category. The company should choose which Question Mark they want
SPACE Matrix
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Strategy Implementation
There are several strategies that the company cans peruse. From alternative strategies,
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Nestle can follow environmental strategy and growth strategy.
Environmental Strategy
Nestlé deems that environmental functions is a mutual obligation and needs the
support of all segments of society. They are resolute to remain offering leadership
One of the strategies that the company can inspect in order to attain a
is following this strategy in all stages of their product life cycle. This strategy ponders
products. They implement this strategy by the courtesy of the useof sustainably coped
renewable resources, and mark zero leftover. Also, by investing constantly in order to
Nestlé have set several policies for the company to follow in order to implement
One approach that the company is ensuing is they apply a product life cycle
diminish the environmental influenceof Nestlé products and activities. There are four
significance areas for this approach. This can include, water, agricultural raw
instruments their approaches and environmental objectives through out the Nestlé
One of the particular focus areas of the company is water. Nestlé is dedicated to
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the environmental usageof water and nonstop upgrading in water management. This is
done through The Nestlé Commitments on Water set, which sets primacies and
Growth Strategy
Nestlé’s goals are to be known as the world leader in Nutrition, Health and
Wellness, trusted by all its stakeholders, and to be the indication for financial
performance in its industry. They believe that leadership is not just about volume; it is
also about performance. These objectives and behaviors are summarized in the simple
expression, “Good Food, Good Life”, a phrase that recapped the company spirit.
The Nestle Roadmap is intended to create alignment for people behind a consistent
desirable to make for the future and short-term business events, bringing the essential
balanced of performance.
Value” is a term used in the company, which refers to the behaviors, strategies, and
operations that are creating value for the communities where Nestle operate.
Their growth is done by investing for the future in order to certify the financial and
Capacity.
Technologies.
Capabilities.
People.
Brands.
R&D.
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1.Meet today’s needs without compromising the capacity of future generations to
3. Also to provide a high level of returns for shareholders and society at large over the
long-term.
Source:
http://www.nestle.com/ABOUTUS/STRATEGY/Pages/Strategy.aspx
Competitive advantages
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True competitive advantage comes from a
2. Unmatched R&D capability throughout the value chain, built up over decades.
http://www.nestle.com/ABOUTUS/STRATEGY/Pages/Strategy.aspx
Growth drivers
5. Nutrition, Health and Wellness prospects for growth. They are applicable
6. Emerging markets and PPP across all our categories and around the world.
7. Out-of-home leadership
Everything we do is driven by our Nutrition,
8. Premiumisation
Health and Wellness agenda, Good Food,
their categories
Source:
http://www.nestle.com/ABOUTUS/STRATEGY/Pages/Strategy.aspx
Operational pillars
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Nestlé must excel at each of these four inter-related
http://www.nestle.com/ABOUTUS/STRATEGY/Pages/Strategy.aspx
After implementing strategies, the firm needs to evaluate them and find a way to
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Conclusion & Recommendations
In order for the company to achieve strategic analysis efficiently, rhe following
utilization of resources.
competencies.
3. The strategy group should then appraise the potential of resources and capacities.
5. Nestle strategy managers should identify resource gaps, which need to be filled,
as well as invest in refilling, enhancing and upgrading the firm's resource base.
Executive summary
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In this project which is about a strategic management case we chose a well-
conditions and of course focusing on their history, mission, vision, strategies and so
on. For any company that seeks development, they will need to improve their vision
that might face them with in the years. Nestle?s improved vision statement is better
in the sense that it is drastically shorter than the original vision provided by the
company and of course it is more direct and promising to all of their consumers. Then
devotion, and that it does not just stop at that, but it also shares how the company is
internal factors that has an impact on the company, where the Internal assessment
includes the financial ratios, their market map, their market strategy, and their
organizational and how it could be one where departments are divided according to
the genre of the product being manufactured and sold, thus making it relevant and
more convenient to manage and project expectation and goals. For the external
Matrix, and illustrating the External factors Evaluation (EFE) Matrix. Where in that
part It identifies the opportunities and threats for the company and how it has been
conducted.
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Moreover, the company needs to formulate, implement, and evaluate their
strategies. In the stage of formulation the strategy we explained the SWOT analysis,
the SPACE matrix, and BCG product matrix. SPACE matrix showed the industry
where we explained all the factors, Star, cash cow, question mark, and the dog with
examples of the company?s products that represents them. For the implementation
stage, we evaluated and discussed the strategies that Nestle uses such as, the
Environmental and the growth strategies. After the formulation and implementation,
any company needs to evaluate their strategies and know how to control them.
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References
"Get GCSE Political decisions can affect Nestle for the good and the bad, because if
including assignments fully Marked by Teachers and Peers. Get the best results
here.." Get Coursework & Essay Homework Help at Marked by Teachers.com. N.p.,
studies/political-decisions-can-affect-nestle-for-the-good-and-the-bad-because-if-
taxes-increase-therefore-consumers-decrease-and-sales-of-stock-decrease-however-if-
taxes-decrease-the-likelihood-is-that-consumers-will-buy-more.html
"Knowledge Inn: NEstle BCG Matrix."Knowledge Inn. N.p., n.d. Web. 31 July 2012.
http://kninn.blogspot.com/2010/06/nestle-bcg-matrix.html
http://www.nestleprofessional.com/uk/en/SiteArticles/Pages/Out-of-home-Trends-
and-External-influences.aspx
"Nestle: Strategic Plan Guidlines - Research Papers - Ccpaire." Free College Essays,
Term Paper Help, and Essay Advice - TermPaperWarehouse.com. N.p., n.d. Web. 31
Guidlines/78510
July 2012.
Strategy - Nestlé Roadmap to Good Food, Good Life. (n.d). Retrieved in August
1,2012 from
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http://www.nestle.com/ABOUTUS/STRATEGY/Pages/Strategy.aspx
http://www.articlesbase.com/management-articles/strategic-management-at-nestle-
5907881.html
The Nestlé Corporate Business Principles. (2010). Retrieved in August 1,2012 from
http://www.nestle.com/Common/nestleDocuments/Documents/Library/Documents/Co
rporate_Governance/Corporate-Business-Principles-EN.pdf
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