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History Of NESTLÉ

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Category: Business

Autor: peter 08 March 2011

Words: 991 | Pages: 4

History of NESTLÉ

NESTLÉ (NESTLÉ Homepage) founded by Henri NESTLÉ in 1866, is a food and beverage industry with headquarter in Vevey, Switzerland. Today, NESTLÉ had more than 500 sub-companies in 80 countries. It has became the world's leading nutrition, health and wellness company with the slogan of "Good Food, Good Life". NESTLE's daily operation has been guided by several principle such as creates equal creation of value to stakeholders, promotes long-term performance and produces the best to people no matter where and what they need throughout their lives.

In order to achieve one of their objectives, NESTLÉ offers nutritionally balanced products at affordable price and tailors consumers' need. Not only that, NESTLÉ also supports government's efforts to encourage people to have healthier diets and active lifestyles. This effort is to overcome problems such as obesity, diabetes and cardiovascular diseases (NestleHomepage, n.d).

NESTLÉ in Malaysia

NESTLÉ Malaysia has 2 head offices, 10 branches of Administration offices and 9 factories nationwide (Jaafar, 2010). To costume Malaysia's culture and lifestyle, NESTLÉ has produced six HALAL product lines which are beverage, milk, prepared food, ice cream, cereals and chocolates. Each product line has various types of products to satisfy Malaysian's preference. Due to the changing of Malaysian's lifestyle, there are varieties products for each product lines. The following table shows each of the NESTLÉ product lines.

NESTLÉ Product

Beverage Cereals Milk Chocolates Ice Cream Instant Food

Milo Honey Star Nespray Kit Kat Drumstick Maggi

Nescafe Koko Crunch Neslac Smarties Trophy Buitoni

Canned Drink Cookie Crisp Milky Bar Mart Kool

UHT NESTLÉ Crunch

Table 1: The various type of NESTLÉ product lines

2.0 Drivers for Change

NESTLÉ, with 500 factories worldwide, exercise 50 different transaction systems in different countries (www.sap.com, 2001). According to Jan Ottmer, NESTLÉ Nordic's Chief Information Officer, claimed that NESTLÉ was not systematically work under one unit. Due to globalization, each country operated with its own type of information technology (IT) system. Harmon (2002) has further studied the problem of NESTLE. In his studies, each NESTLE's branch from different countries was paying 29 different prices for a particular vanilla in the mid 19th. However, each branch was purchased from the same vendor. Furthermore, each company had different product name, code number and different processes of the transaction. As a result, the reputation of a top leading brand has perceived as an unsystematic management and quaked shareholders' confidence which lead to reduction in the market share (Harmon, 2002). Hence, the first problem is NESTLÉ was lack of effective communication among different branches.

Next, NESTLÉ was inability to access to the latest marketing information and make dynamic change to support customers' needs and wants. NESTLÉ quickly responded to the problem where connected all branches under a host in NESTLÉ headquarters with a communication infrastructure (VC insight newsletter page, 2004). Then, NESTLÉ planned to build worldwide with the IP infrastructure but realized it needs plenty of time. Hence, the second problem is an effective customer relationship management (CRM) is needed for NESTLE.

3.0 Strategic initiatives with IT solutions

NESTLÉ has been adopted several software since that day the problems were founded until today. Two strategies were implemented by NESTLÉ to eliminate the problems show above and improve the reputation of company.

3.1 Audio and Video Conferencing (AVC)

NESTLE's management team decided to improve the relationship between the decision makers, they have came to a solution by using Audio and Video Conferencing (AVC). Since the mid of 2000, NESTLÉ has contracted with several software vendor such as RADVISION (2004), mySAP (2007) and BT Global (2009).

In 2004, NESTLÉ has contracted with a software agent, RADVISION. RADVISION provided service to handle simultaneous multipoint voice and video conferencing (VC insight newsletter page, 2004). One of the reasons that NESTLÉ has chose RADVISION was because the reliable has proven through an experiment which it can response immediately for technical support. For example, NESTLÉ had a minor problem in the initial installation and in the next day, RADVISION had sent an expert from Israel to fix the problems (VC insight newsletter page, 2004). According to the Head of Telecommunication at NESTLÉ, Mr. Dufour claimed that they feel secure to have RADVISION's prompt and effective support.

In 2009, under the current term of agreement with BT Global (www.btplc.com, 2009), BT will provide a fully-managed video conferencing service to NESTLÉ with the support of Video Business Unit (VBU) Concierge service. BT is providing high quality video conferencing experience by using high-definition video and multi dimensional sound to support the software (www.btplc.com, 2009). A center hub has been established and connected to all branches worldwide. According to BT president, Mr. Campenon (2009), NESTLÉ is offering their employee the feeling of being in the same meeting room with others globally.

Figure 1: The overview of AVC process

3.2 Sales Force Automation (SFA)

Plenty of product ranges that NESTLÉ has been selling. Therefore, NESTLÉ need to collect market intelligence in the daily basic. According to Haag, Baltzan & Phillips (2007), market intelligence can be defined as the relevant information to a company's market will be collected and analyzed to make specific decision. Traditionally, market information was collected through pen and paper but now NESTLÉ has decided to use SFA system to improve the sales effectiveness and decision making. In 2004, NESTLÉ has signed a contract with Motorola to provide Sales Force Automation (SFA) system (www.motorola.com, 2006). According to NESTLÉ Sales Director in Malaysia, Ganesan A. in order to achieve flawless execution, NESTLÉ need a system which could replace the manual order taking procedures (www.motorola.com, 2006.).

With the assistance of Motorola's Enterprise Digital Assistant (EDA), a handheld device that able to connect through wireless, the sales reps will discover the customer buying behavior. SFA system records the data about customer, product details, and customer's codes whenever a single barcode scan by EDA. Every sales rep could upload and download customer pricing and product information from the host by using ThinqComm communications software (www.motorola.com, 2006.). This software was operating under Microsoft NT server. According to Collis, M., National Sales Manager in Australia, claimed that the sales personnel find the software is powerful where it allows to upgrade salesperson selling tools and the information flow (www.motorola.com, 2006.).

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