Nestle Performance Management (1)
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The document summarizes a report completed by a group of MBA students at Nestle. It includes an introduction of the group members, acknowledgements, and an outline of the report contents. The report focuses on Nestle's performance management and how the Human Resources Continuous Excellence department contributes to increasing employee performance. It discusses Nestle's organizational structure, information systems, reward programs, training initiatives, and other human resource practices that aim to achieve high performance. The findings are analyzed across two dimensions: the key elements of a high performance work system, and the intended outcomes of such a system for Nestle.
Nestle Performance Management (1)
- 1. Nestle Group Members Kamran Aqeel (2012-mba-27) Nida Munir (2012-mba-29) Maida Afzal (2012-mba-31) Samia Ishtiaq (2012-mba-33) Submitted to: Sir Nabeel Arif Managing People for High Performance
- 2. 1 This Project of “Managing People for high performance” is completed with a great effort and true spirit by the following persons, Kamran Aqeel Samia Ishtiaq Nida Munir Maida Afzal All these members work hard for collecting information and for completing the report, they work as a team and true team spirit was among them. the main purpose of this project was to understand how a company face different kind of challenges relates to their high performance and in which areas company face different kind of problems due to lack of competence. This project is completed in two stages Collection of information Making Report All the credits go to ALLAH THE All MIGHTY AND THE MOST BENEFICIAL for giving us such power and wisdom to complete the report on time. May Allah’s blessings remain on us forever (ameen) and we are very thankful to Mr Tariq and Mr M.Amjad (Employee Services & solution Manger Nestle), Ms Nadia Umer for helping us by giving information about the Nestle Pakistan and for guiding us for our project at the last we would like to thank Sir Nabeel Arif for taking us in confidence and giving us an opportunity to make the report and to learn that what are the problems companies face now a days in Managing people for high performance.
- 3. 2 Table of Content Executive Summary…………………………………………………………………………………4 History of Nestle……………………………………………………………………………………..5 Henri Nestlé, the founder of Nestlé……………………………………………………………….5 Introduction of Nestle……………………………………………………………………………….6 Nestlé’s Vision Statement……………………………………………………………..……………6 Nestlé’s Mission Statement………………………………………………………………………...6 Nestlé’s Slogan……………………………………………………………………………......6 Nestle Core values…………………………………………………………………………....6 Our Goals………………………………………………………………………………….…7 Global Structure……………………………………………………………………………..7 Some Nestle Brands…………………………………………………………………………………8 Nestle Pakistan…………………………………………………………………………………….…8 Human Resource Management of Nestle Pakistan…………………………………………….9 Nestle Continuous Excellence Department……………………………………………………...9 Ms. Nadia Umer…………………………………………………………………………………….10 Methodology use for collection of data…………………………………………………………11 Problem Based learning…………………………………………………………………………...11 Company Visit………………………………………………………………………………………...11 Questionnaire (employees) ………………………………………………………………………...…11 Meet with leaving employee…………………………………………………………………………..11 Findings……………………………………………………………………………………………...12 First Dimension……………………………………………………………………………………..12 Elements of high performance work system………………………………………………………….12 Organizational structure……………………………………………………………………………….12 Human Resource Structure…………………………………………………………………...13 Shared Services………………………………………………………………………13 Centre of Expertise…………………………………………………………………..13 Business Partners…………………………………………………………………….13 Organization Chart …………………………………………………………………………...14 Required employees by overall Nestle……………………………………………………….15 Required employees by overall NCE…………………………………………………………15 Problem in Organizational structure………………………………………………………....16 Location………………………………………………………………………………………16 Reward system………………………………………………………………………………………...16 Reward linkage with Performance at Nestle…………………………………………………16 Employee wellness programs…………………………………………………………...……17 Perks at Work program……………………………………………………………………….17 Paid Time off………………………………………………………………………...17 Holidays……………………………………………………………………………...17 Parental Leave………………………………………………………………………..17 Health Works………………………………………………………………………...17 Online Services & Discounts………………………………………………………...17 Employee Assistance Program (EAP) ……………………………………………………….17 Counseling, Education Resource & Referral Services………………………………………17 Problems in Reward System………………………………………………………………….17 People………………………………………………………………………………………………….18 Selection & recruitment in Nestle Pakistan……………………………………………..……18 Recruitment…………………………………………………………………………..19
- 4. 3 Selection……………………………………………………………………………...19 Training Programs at Nestlé………………………………………….………………………19 Literacy Training…………………………………………………………………….20 Nestlé Apprenticeship Program……………………………………………………..20 Local Training………………………………………………………………………..20 International Training………………………………………………………………..20 Development program in Nestle……………………………………………………………...20 Information system……………………………………………………………………………………21 Globe Program Objectives……………………………………………………………………21 Email………………………………………………………………………………………….22 Telephone……………………………………………………………………………………..22 ERP at Nestle…………………………………………………………………………………22 Problems in Information system of Nestle…………………………………………………...22 Task Design……………………………………………………………………………………………23 Job description (JDs…………………………………………………………………………..23 Example………………………………………………………………………………………24 Justice and equity……………………………………………………………………………………...24 Second Dimension………………………………………………………………………………….25 Higher productivity and efficiency……………………………………………………………………25 Contribution to the Lower Cost……………………………………………………………………….27 Higher Product Quality …………………………………………………………………………….…27 Customer Satisfaction…………………………………………………………………………………28 Low Employee Turnover……………………………………………………………………………...29 Learning Organization………………………………………………………………………………...29 SWOT of Nestle…………………………………………………………………………………….30 HRM practices organization is doing to achieve high performance……………………….31 Shared Services ………………………………………………………………………………31 Centre of Expertise…………………………………………………………………………...32 Training and development of Nestle…………………………………………………32 Workforce Planning………………………………………………………………….32 Man Power Planning…………………………………………………………………32 Performance related pay (PRP) ……………………………………………………...32 Objective Evaluation of the Organization…………………………………………...32 Role as a Business Partner …………………………………………………………………...33 How well company has managed its performance management…………………………...34 Competency profile mapping…………………………………………………………………34 Critical Analysis of HR PERFORMANCE…………………………………………………..34 Nestle Continues Excellence (NCE) …………………………………………………………35 Conclusion…………………………………………………………………………………………...35 References…………………………………………………………………………………………...35 Questionnaire……………………………………………………………………………………….36
- 5. 4 Performance Management is an important part of any organization which increases the performance of the employees in our report we discuss about the performance management of the Nestle Pakistan and how human resource continues excellence department contribute to increase the performance of the employees. We discuss about six elements of work system, organizational structure, information system, task design, reward system, people and justice and equity that how these elements increase the performance of the employees and what are the problems in these elements, than we discuss about the outcomes of high performance work system that what are the positive and negative outcomes in the work system, than what HRM practices organization is doing to achieve high performance and how ell company has managed performance management, our focus is on HR department of Nestle pk in this report.
- 6. 5 History of Nestle The key factor which drove the early history of the enterprise that would become The Nestlé Company was Henri Nestlé's search for a healthy, economical alternative to breastfeeding for mothers who could not feed their infants at the breast. Nestlé is a Swiss company, founded in 1866 by Henri Nestlé invests Around CHF 1.5 billion in Research and Development every year Nestlé markets its products in 130 countries across the world. Henri Nestlé also showed early understanding of the power of branding. He had adopted his own coat of arms as a trademark; in Swiss German, Nestlé means 'little nest'. One of his agents suggested that the nest could be exchanged for the white cross of the Swiss flag. His response was firm: "I regret that I cannot allow you to change my nest for a Swiss cross .... I cannot have a different trademark in every country; anyone can make use of a cross, but no- one else may use my coat of arms." The Company's strategy will continue to be guided by several fundamental principles. Nestlé's existing products will grow through innovation and renovation while maintaining a balance in geographic activities and product lines. Long-term potential will never be sacrificed for short-term performance. The Company's priority will be to bring the best and most relevant products to people, wherever they are, whatever their needs, throughout their lives. Henri Nestlé, the founder of Nestlé Henri Nestlé, the founder of Nestlé, was a life-saving chemist but also an innovative marketer. He used scientific knowledge to develop products that met consumer needs. He used his name to brand his products in a distinctive way. And he set up systems to distribute his products quickly and effectively.
- 7. 6 Introduction of Nestle Nestle is world’s largest corporation of food and beverage. Although less than 2% of our sales are generated in Switzerland, Nestlé is a Swiss company. They are the leader in nutrition, health and wellness. This company has recognised brand name and very significant influence on customers, business and government bodies as well. Their products ranges from drinks like tea, coffee, water, ice-cream to baby food, pet care, pharmaceutical and confectionary Nestlé markets its products in 130 countries across the world Nestlé manufactures around 10,000 different products and employs some 250,000 people Nestlé sells over a billion products every day Nestlé is more than just the largest food and beverage company in the world. Increasingly, Nestlé is becoming the world’s leader in nutrition, health and wellness. From the start, nutrition has been at the core of our business. However, today we place far greater emphasis on it – and on health and wellness. Our Corporate Wellness Unit and the individual business units are driving forces in bringing Good Food, Good Life to all our consumers. Nestlé’s Vision Statement “Nestlé’s aim is to meet the various needs of the consumer everyday by marketing and selling foods of a consistently high quality.” Nestlé’s Mission Statement “We strive to bring consumers foods that are safe, of high quality and provide optimal nutrient to meet physiological need. Nestle helps provide selections for all individual taste and lifestyle preferences.” Nestlé’s Slogan “Good food good life” Nestle Core values 1. People 2. Quality 3. Brands 4. Consumer 5. Customer 6. Performance
- 8. 7 Our Goals To be the reference for 1. Nutrition, Health and Wellness 2. Sustainable Financial Performance 3. Trust by all stakeholders Global Structure At the international level, the world is divided into four parts, each reporting to the world headquarters in Switzerland. Nestlé employs bottom-up as well as top-down reporting. For yearly budgeting, each territory reports next year’s forecasted sales to its Area Manager who after gathering all these reports sends a summary for his area to the Regional Manager. Regional and Zonal Manager do the same process until National Sales Manager has the forecasted sales for the entire country. Target sales are then reported down to each zone, from where it is sent to each region, and the process continues until each territory has its target sales
- 9. 8 Some Nestle Brands Nestle Pakistan Nestlé Pakistan today, is a leading Food & Beverage Company in Pakistan with a key focus on nutrition, health and wellness reaching the remotest of locations throughout the country to serve consumers and continue to enhance the quality of life of people throughout its value chain. Nestlé Pakistan Ltd is a subsidiary of Nestlé S.A. – a company of Swiss origin headquartered in Vevey, Switzerland. It is a food processing company, registered on the Karachi and Lahore stock exchanges and operating in Pakistan since 1988 under the joint venture with Milk Pak Ltd and took over the management in 1992. For last many years in a row, the company has won a place among the top 25 companies of the Karachi Stock Exchange.
- 10. 9 Nestlé Pakistan operates in many ways but people, products and brands are the basis of the Company’s image. It respects the cultures of the regions it operates in and recognizes the need for quality of life of their people. Nestlé Pakistan operates in many ways but people, products and brands are the basis of the Company’s image. It respects the cultures of the regions it operates in and recognizes the need for quality of life of their people. Human Resource Management of Nestle Pakistan In 2012, Human Resource continued its journey from last year, to cultivate a culture of talent diversity, high performance and ensuring compliance. Initiatives taken were focused towards enhancing performance principles, leadership development, and career growth, attracting right talent and providing avenues for learning. Additionally, Human Resource team has been thoroughly involved in the progress of the Nestlé Continuous Excellence journey, by providing its support and guidance in maintaining employee engagement, people development processes and appropriate goal alignment. With a mind-set towards achieving sustainable excellence, a comprehensive learning programmer surrounding concepts of coaching and feedback was rolled-out to targeted groups of existing and upcoming leadership. With blended learning approach and meticulous evaluation technique, the programmer was well received and laid foundations for a community dedicated to drive the desired mind-set to all levels within the organization. With focus on bringing excellence in our service delivery, Human Resource continued to implement the findings of the survey results regarding level of satisfaction on our processes and services. The objective remains to fortify the strengths identified and work on gaps highlighted in our journey. For Human Resource, 2012 was about continuity, pursuing its drive for strengthening a high performance culture and developing the people by facilitating them with a progressive and healthy work environment. Nestle Continuous Excellence Department During the year 2012 we have continued to hold the responsibility for the environment, personal safety, and the safety of others. In view of the growing demands of the market and changing consumer needs, an expansion in the current manufacturing foot print is under execution. On one hand Nestlé Pakistan is investing to take care of health and wellness of the consumer while on the other hand the Company is keen to look after the needs of its employees, hence addition of new social block in the factory.
- 11. 10 Ms Nadia Umer: Nadia joined Nestle Pakistan in 2010 and since then has been very instrumental in the development of the juices portfolio by deepening the consumer base to fully capture the in- market opportunity. Some of her notable achievements are SKU Optimization leading to increased sales velocity with reduced operational complexity and building super premium range. She has also been a key team member in the LEAN pilot in Juices and contributed to the roll out of the Operational Master Plan and Consumer Customer Value Proposition (CCVP) for the business Methodology use for collection of data Problem Based learning: Our learning is Problem based learning. Problem-based learning (PBL) is an approach that challenges students to learn through engagement in a real problem. It is a format that simultaneously develops both problem solving strategies and disciplinary knowledge bases and skills by placing students in the active role of problem-solvers confronted with an ill-
- 12. 11 structured situation that simulates the kind of problems they are likely to face as future managers in complex organizations. Now the purpose of getting information we use three kinds of Methods which are following there: Methods for collecting information: In our report we use three kind of methodology for collecting information relating to our project. Company Visit Questionnaire (employees) Meet with leaving employee Company Visit: First of all we visit Nestle Company which is situated in upper Mall, and meet HR manger of Nestle, he provides us different information regarding HR activities of the Nestle company and also provide us ideas that how can we cover all the dimension of our project. Questionnaire (employees): For more clarification and for getting more information we also get ideas of employees of Nestle through using Questionnaire. Which provide us hidden problems related to the elements which affect the performance of those employees? Meet with leaving employee: Further we meet Employees which recently leave the Nestle Company and ask them what the reasons are and what are the problems due to which you decided to leave the Nestle Company, we also asked him that what are the problems he face during performing his job in Nestle with respect to the performance management. Internet: Searching from internet
- 13. 12 Findings After the collection of data regarding the performance management of the Nestle Pakistan we find some information from which we can understand about the performance management of Nestle. First Dimension In first Dimension we discuss about the elements of the high performance work system which are following their: Elements of high performance work system 1. Organizational structure 2. Information System 3. Task Design 4. Reward system 5. People(selection, training and development) 6. Justice and equity Organizational structure Nestle Organizational structure is Decentralized its mean that the Middle level management have also decision making authority. In all countries parent group is to Swizz Land because Nestle is a Swizz Land Company. Nestlé Pakistan follows a flat, matrix organizational structure the departments are divided function-wise and product-wise. All the products use different functional departments and all the functional departments have specific product department within them. The span of control is wide as each department head has much direct and indirect reporting relation with his subordinates. The Managing Director of Nestlé Pakistan reports directly to the Head Office in Switzerland, and gets guidance and objectives from them. Directors are different functional departments: Business Executive Managers Head of Human Resource Department Head of Sales Department Head of Supply Chain
- 14. 13 (Nestle Pakistan Organizational Structure) Human Resource Structure The Human Resource Department is subdivided into three branches: Shared Services Centre of Expertise Business Partners Shared Services Shared Services are responsible for data and record collections of all the employees of Nestlé Pakistan. They handle the payrolls, division of provident funds, medicalallowances, travel allowances, and all other administration of the employee funds. Centre of Expertise Centre of expertise is responsible for recruitment, remuneration and organization development through Nestle Training programs, both local and international. HeadOfSwizLamd Manging Director Head of Legal Department Head of Supply cjain Head of technical department head of Human Resource Share Services Centre of Expertisse Business PatnersHead of finace Head of Sales Business Excellence Manger Head of food services
- 15. 14 Business Partners The Business Partners form the link between different human resource activities of theorganization, and the functional departments they are working with. The HumanResource Manager–Commercial is a Business Partner for Sales and reports to the Head of Sales Department. He is supposed to form a link between the Human ResourceDepartment and the Sales Department, making sure all decisions made by the Sales Department are in line with the Company’s goals and policies Organization Chart: Human Resource department Share Services Centre of Expertise Business Patners Customers Sales persons Managers BOD
- 16. 15 Required employees by overall Nestle: If we talk about overall nestle than nestle needs top level employees as well as average or lower level employees, high level employees means those can perform high and average means those can perform average, it can show in this kind of bell curve: High performance employees Average Performance employees Lower level employees Required employees by overall NCE: If we talk about continuous excellence department which is managed by Ms Nadia Omer, in this department we need high level employees those can perform high.it can show like this, High performance employees
- 17. 16 Problem in Organizational structure Although Nestle organizational structure is very effective but there are some positive things and some negative things in every structure. So Nestle organizational structure is decentralized, there are a positive thing that they gave all decision making authority to the lower level of management and they are responsible for the effectiveness, efficiency and the failure of their specific field but on the other hand there are disadvantage of this that top level management is more conscious about the organization as compare to the lower level management and Span of control is so wide which is also a problem. Location: NESTLE PAKISTAN LTD 308, Upper Mall, Lahore PAKISTAN HEAD OFFICES OF NESTLE LTD Reward system In Nestle there is proper reward system for employees. Nestlé favours competitive, stimulating and fair remuneration structures offering an overall competitive and attractive compensation package. Remuneration includes salary, any variable part of remuneration as well as social, pension and other benefits. Employees are paid for their skills as they deserve. Attractive salary is paid to them as they deserve. Much kind of facilities are also provided to the employees who motivate the employees. Reward linkage with Performance at Nestle: =Effort Performance =Performance-reward linkage =Attractiveness Individual Efforts Individual Performance Organizational Reward Individual Goals A B C A B C
- 18. 17 Employee wellness programs Worksite wellness programs have gotten a boost in recent months because of their possible role in promoting employee wellness through such benefits as counselling and onsite health centres Perks at Work Programme Nestle help its team keep their work and home life in balance through what they call 'Perks at Work. The best associates are healthy and happy, and lead full lives. Paid Time Off Associates earn paid time off each month to use for sick leave, family illness, vacation, or personal reasons. Holidays Nestlé Purina provides regular paid holidays each year. Parental Leave Leave is available for birth and adoptive fathers and mothers who are salaried or non-union hourly associates. Health Works The Health Works program helps Nestle associates and their families stay fit and healthy. Nestle program also provides associates with opportunities to participate in preventative programs that help save money on heath benefit costs while ensuring Nestlé’s associates remain healthy. Online Services & Discounts Nestlé Purina associates can receive discounts for theatre and entertainment, travel and lodging, electronics, gifts, financial services, local services and more. Employee Assistance Program (EAP) The EAP provides easy, free, confidential access to professional counsellors trained to help with a variety of personal or family problems. Counselling, Education Resource & Referral Services This service offers information and referrals on adoption resources, prenatal care, child care and elder care services, parenting, educational opportunities and a variety of personal / convenience services. Problems in Reward System But there are also an element of scheme system in nestle reward system in which reward are provided to the employees through the schemes. In which deserving employees can’t receive
- 19. 18 these kind of reward but those employees that does not deserve these kind of rewards, get these reward, so those employees those work hard , and deserve these kind of rewards demotivate with these kind of things. Moreover some training programs , foreign tours, and many more these kind of facilities are also provided to just some employees other employees working on the same post does not receive these facilities at the same time so those employees who get these facilities motivated but those employees those does not receive these kind of facilities demotivate because of these things. According to the Nestle Employee services & solution manger Muhammad Amjad, there are too kind of factors in organization which can affect the performance and behaviour of the employees, Intrinsic factors and extrinsic factors. By intrinsic factors their employees motivated and with the extrinsic factors their employees demotivate. People Selection & recruitment in Nestle Pakistan Recruitment and selection forms a core part of the central activities underlying human resource management: namely, the acquisition, development and reward of workers. It frequently forms an important part of the work of human resource managers – or designated specialists within work organisations. However, and importantly, recruitment and selection decisions are often for good reason taken by non-specialists, by the line managers. There is, therefore, an important sense in which it is the responsibility of all managers, and where human resource departments exist, it may be that HR managers play more of a supporting Extrinsic Factors Supervision Company Policy Working Conditions Relationship with peers Security Intrinsic factors Achievement Recognition Responsibility Advancement Growth
- 20. 19 advisory role to those people who will supervise or in other ways work with the new employee. Recruitment: Recruitment is the process of attracting individuals on a timely basis, in sufficient numbers, and with appropriate qualification, and encouraging them to apply for jobs with an organization. Selection: Training Programs at Nestlé The willingness to learn is therefore an essential condition to be employed by Nestlé. First and foremost, training is done on-the-job. Guiding and coaching is part of the responsibility of each manager and is crucial to make each one progress in his/her position. Formal training programs are generally purpose-oriented and designed to improve relevant skills and Recuirted candidate Preliminary Interview Review of application & Resumes Selection Test Employement Interviews Reference & Background checks Selection Decision Medical Examination New Employee
- 21. 20 competencies. Therefore they are proposed in the framework of individual development programs and not as a reward. Literacy Training: Most of Nestlé’s people development programs assume a good basic education on the part of employees. These programs are especially important as they introduce increasingly sophisticated production techniques into each country where they operate. As the level of technology in Nestlé factories has steadily risen, the need for training has increased at all levels. Much of this is on-the-job training to develop the specific skills to operate more advanced equipment. But it’s not only new technical abilities that are required. It’s sometimes new working practices. Nestlé Apprenticeship Program: Apprenticeship programs have been an essential part of Nestlé training where the young trainees spent three days a week at work and two at school. Positive results observed but some of these soon ran into a problem. At the end of training, many students were hired away by other companies which provided no training of their own. Local Training: Two-thirds of all Nestlé employees work in factories, most of which organize continuous training to meet their specific needs. In addition, a number of Nestlé operating companies run their own residential training centres. Virtually every national Nestlé company organizes management-training courses for new employees with High school or university qualifications. But their approaches vary considerably International Training: Nestlé’s success in growing local companies in each country has been highly influenced by the functioning of its international Training Centre, located near our company’s corporate headquarters in Switzerland. Development Programme in Nestle: Learning is part of the Nestlé’s culture. Each employee, at all levels, is conscious of the need to upgrade continuously her/his knowledge and skills. The willingness to learn is therefore a non-negotiable condition to be employed by Nestlé. Each employee is in charge of her/his own professional development. However, the Company actions to offer the opportunity to progress for those having the determination and the potential to develop their capabilities
- 22. 21 Information system Information system that Nestle use is Globe 1 Nestle use Globe to unlock Nestle potential by: Leveraging our size as a strength in a rapidly changing enjoinment Uniting and aligning us on the inside to be more globally competitive on the outside Enabling nestle to manage complexity with operational efficiency. Globe Programme Objectives Implementation of harmonized Nestle Business Excellence Best Practices Implementation of data Standards and Data Management “Managing Data a Corporate Asset” Implementation of standardized information system and Technology
- 23. 22 Globe allow Nestle to Speed to share and implement new best practices Provide better information for better decision Facilitate Organizational change Allow for focus on generating demand activities Email: Email is also used to communicate with employees and external parties Telephone: Telephones are also used to communicate with lower staff or other peoples ERP at Nestle: In 2000 Nestle SA signed a $200 million contract with SAP to roll out an ERP system. Nestle SA also committed to an additional $80 million to be spent on consulting, maintenance, and upgrades. Keeps track of customer orders reduce overstocking Enables group buying of materials data sharing among subsidiaries Problems in Information system of Nestle: 2,30,000 employees and 500 facilities in 80 countries to support the decentralized strategy it has 80 different information technology units that’s runs nearly 900 IBM as/400 mid-range computers ,15 main frames , and 200 Unix system despite its size the company has had no corporate computer centre Local difference created inefficiencies and extra costs that could prevent the company from competing effectively in electronic commerce. The lack of standard business processes prevented it from obtaining lower prices for its raw material. at first project decide not to use sap’s supply chain software because that module was brand new and appeared to be risky The staff that would be directly affected by the changes was not included in the key stake holder team. The lower level worker did not understand how to use the new system and also did not understand the changes; nobody was prepared for the new ways of doing things.
- 24. 23 Turnover among the employees who were to use the Manugistics software to forecast product demand reached 77 parents. Those who remained found it easier to use their familiar spread sheets. The simultaneous installation of the Y2K changes also caused some trouble. Task Design Task Design determines how the details of the organization’s necessary activities will be grouped, whether into jobs or team responsibilities. Job description (JDs): Nestle provide job description to its employees at the time of selection. Job description is a document that provides information regarding the tasks, duties and responsibilities of job. Job Analysis for Team Legal consideration Employee & labour relation Safty & health compensation & benefits Performane appriasal Training &development Selection Recruitment Human Resource PlaningTasks Responsibilities Duties Job specification Job Description Job Analysis AbilitiesSkillsKnowledge
- 25. 24 Example: An employees is hired in nestle first of all he hired according to his job specification than he informed about his tasks, responsibilities, and duties which he have to complete in his j in simple words management governs how the details of the organization’s necessary activities will be grouped. Justice and equity: There are many aspects to justice and the creation of a just world. These include social and economic factors as well as the principles of equity and equal rights. “Social justice” has been defined in a variety of ways. Amongst them, they incorporate concepts of basic rights, the realisation of human potential, social benefit, a healthy planet, an equitable distribution of resources, equal opportunities and obligations, security, and freedom from discrimination. Economic justice really forms a part of social justice. It seeks the equitable distribution of world’s natural and intellectual wealth so that everyone is able to gain a fair share. As Nestle is a large organization so nestle follow justice and equity in every situation, but according to some questionnaires and leaving employee, there is also an element of favouritism. Mangers are selected in the presence of the directors so the deserving candidates are selected always. Average level of employees is also selected according to the job specification and according to their qualification and skills, but there also an element of Intercede in some situations which affect the justice and equity.
- 26. 25 Second Dimension Outcome of high performance work system 1. Higher productivity and efficiency: 2. Contribution to the Lower Cost: 3. Higher Product Quality 4. Great Customer Satisfaction 5. Low Employee Turnover 6. Learning Organization Higher productivity and efficiency: Positive outcome: There are a separate department NCE (Nestle continues Excellence) managed by Ms Nadia Umer, aim of this department is to enhance the performance of the employees more and more well. due to the efforts of this department productivity and efficiency of the employees increases Due to efficient and fully managed organizational structure nestle productivity and efficiency of the employees increase. In decentralization managers feels good that they are responsible for efficiency. Moreover if we talk about the location of the head office of the Nestle Lahore Pakistan , about which we are discussed, is situated at the upper mall, so that employees can easily access, so their productivity increase as wall as they become efficient for their work because location of office have an impact on the performance of the employees. If we take a look at the reward system of the employees in Nestle Pakistan, so the reward system of nestle is also properly managed, every employee is paid for their skills and for their work, moreover financial motivation for good work also provided, so the efficiency and productivity of the employees automatically enhance because they know that if they are performing very well they’ll be rewarded, so it affects the high performance of the employees of the Nestle. Information system of the Nestle is well managed they use Globe for their information system. So any employee if face any kind of problem in performing their high performance they can take any help from this information system so productivity and efficiency of the employees automatically increase. Employees are provided job description so that they know what they have to do, management make them clear what they do so that they can perform their work very well.
- 27. 26 People in the Nestle are selected according to the job specification so they are well trained that’s why they perform efficiently moreover there are also some developing programs for employees so they can improve their skills for better performance. They are directly proportional to each other as we discussed above that justice means providing equal rights to every person in an organization and equity means to an employee according to his performance so if justice and equity both are providing in an organization there will be no discrimination at all in the organization and people will love to work there with full concentration which will result in the high productivity and high efficiency of the workers. Negative outcomes: Organizational structure is decentralized, top level management is more conscious about the organization as compare to the lower level management. so in Nestle Decision making authority is to the lower level management so as compare to the top management lower level management can’t handle the issues more efficiently, and span of control is so wide so this thing affects the productivity and efficiency of the employees. Information system is very effective but for the lower level employees it is difficult to handle this kind of information system so it affects the productivity of the lower level employees. People are selected according to the job specification but we observe the element of Intercede in some cases so employees are not employed according to the job specification in these cases so the employees don’t know how to perform according to the standard of quality work so in these cases productivity and efficiency effects. While Nestle Pakistan is providing so many facilities and so many incentive to their employees which enhance the productivity and effectiveness of their employees, but when the problem which is discussed in reward system occurred, than the employees those does not receive these kind of facilities they demotivate and their efficiency and productivity affects. Furthermore when some employees are sent to the foreign countries for the training but the other employees those are working on the same post are not sent, they demotivate with this thing and it affect their productivity and efficiency.
- 28. 27 Contribution to the Lower Cost Positive outcome: Nestle Pakistan train its employees to for their desire performance when the employees trained they perform according to the requirement of the company so their performance helps company to reduce the cost of the products so training is one of the factors which helps to lower cost. As we know nestle Pakistan is decentralized according to Mr.Muhammad Amjad (employees services solution manger) management is responsible for high and low cost so they struggle for lower cost this thing make the cost low Globe that is use as information system in Nestle ,Globe version 1.5 Roll out incl used in Pakistan, so employees take a lot of help from Globe and this is also contribute to decrease the cost. If employees are selected according to the job specification than they can work more efficient so in Nestle large percentage of employees are hire according to their qualification when they work according to the requirement, than I contribute to the cost. If workers will satisfied with the environment of the organization they will get benefits according to their performance then they will fully concentrate towards their work there will be no leg pulling at all so, the mistakes will be less and in the result the productivity increase and the cost will be low. Negative outcomes: Information system for lower level employees is manual or telephone system, so this kind of information and communication system affects the cost. Different kind of facilities provided to employees increase the cost Training , development processes increase the cost Higher Product Quality Positive outcome: Organizational structure is decentralized, so managers are responsible for their work so they try to maintain the quality because they are responsible for high or low quality. If employees feel any kind of problem regarding the work than they can take help from expertise through Information technology so Information system is also contribute to the high quality When employees are selected according to their qualification than they can contribute to high quality in their field When employees are rewarded than they motivated and try to maintain the quality satisfied employee can satisfy customers If the people feel fairness in management than they contribute to the high quality,
- 29. 28 Negative outcomes: In some cases there are a factor of favouritism, which affect the quality because if employee gain any kind of favouritism than they feel no need to constraint on their quality work and product quality also. In case of Intercede employees are not selected according to their qualification which affects the quality of work and quality of products. Customer Satisfaction As we know Nestle is a very large and trustable organization and customer have a strong trust on the Nestle. Nestlé is committed to offering products and services to Nestlé’s customers and consumers that meet their needs have their preference and provide sound nutrition. We want to win the trust of our customers and Consumers by continuously listening to them, by understanding their expectations and consistently satisfying their needs and preferences. There are also a customer relation management in Nestle which means deepening the relationship with consumers, which involves extra effort in talking to and listening to them regularly. Positive outcome: Nestle is a trusted organization, it manage all the things efficiently from many years so it contribute to the great customer satisfaction. Its MIS system also provides customer desired information to the customers so customer feels happy and satisfied. Negative outcomes: Customers are directly linked with the sellers when seller group not satisfied with company than he can’t satisfy customer.
- 30. 29 Low Employee Turnover According to the Nestle Lahore Pakistan HR manger Nestle turnover rate is 6 to 7 %. Once employee is hired, than Nestle HR manager tries its best to retain the employees, that’s why Nestle turnover rate is low. Positive outcome: Because of the Nestle reputation Employees feel proud to work at Nestle Nestle reward system is very effective so employees feel satisfied and they feel no need to leave the organization. Nestle Information system help the employees a lot and make their jobs easy for them and they face no major problem to perform the job and like their work and feel no need to leave the organization. Employees are clearly defined their work , that what to do, so they know what to do and Nestle never get extra work from employees without their consent so employees get satisfied an turnover decreases. Nestle also offer different kind of training programs and development programs which make their employees happy and thus turnover decreases. Nestle is fair with its employees so employees feel secure to work at Nestle and feel no need to leave the organization. Negative outcomes: According to the leaving employee of the organization, there is an element of favouritism in Nestle organization, so all the benefits are provided to the employees but priority is given to the favouritism employees even they don’t deserve to receive rewards. Globe system is difficult to understand by an average employee, so they hesitate to work at that kind of where technology is up to date and difficult for them to understand. Favourites get priority for foreign training and development courses so other employees get dishearten, and think to change the organization. Learning Organization A learning organization is the term given to a company that facilitates the learning of its members and continuously transforms itself. It encourages organizations to shift to a more interconnected way of thinking. Learning is part of the Nestle culture. Each employee, at all levels, is conscious of the need to upgrade continuously her/his knowledge and skills. The willingness to learn is therefore a non-negotiable condition to be employed by Nestlé.
- 31. 30 Positive outcome: Training is done on-the-job. Guiding and coaching is part of the responsibility of each manager and it is crucial to make each one progress in her/his position. When formal training programs are organized they should be purpose oriented and designed to improve relevant skills and competencies. Therefore they are proposed in the framework of individual development programs. Latest technology used in Nestle makes its employees more learning, and make the organization a learning organization. Foreign training and development program make the employees and organization learning. When all the needs and wants of the workers will fulfil they seek more for the development of their organization and they can think in a better way and participate a role in the performance. Negative outcomes: Some employees those don’t want to learn something because they feel proud to work in Nestle and feel no need for learning SWOT Analysis of Nestle pk Strengths Brand strength Product innovation Research & development Market share Weaknesses MATURE MARKETS Less consumer research in few areas Complex supply chain management
- 32. 31 Opportunities Expansion Product offering Global hub Threats Changing consumer trends Competition HRM practices organization is doing to achieve high performance Nestle HR management perform a number of activities to achieve high performance. Shared Services (SS) As explained in the organization structure, this department is responsible for maintaining the data and records of the employees to decide about their pays, allowances etc. The department is also supposed to carry out the performance appraisals (PA) with the help of the line managers. The SS sets guidelines and provides the line managers with tools, systems and processes to evaluate their subordinates. Based on these evaluations, pays and remunerations are decided. (Remunerations are done by the Centre of Expertise). The pay and compensation strategy is tied to the achievement of the business objectives and helps them build a growth-oriented culture. Apart from payrolls, SS is in-charge of administration of employee funds. It is supposed to decide that which employee gets which fringe benefit, and to what extent, for example, medical allowances, travel allowances etc. The provident funds for employees are also calculated by SS. The SS is a vital department for maintaining employee motivation and loyalty to Nestlé. It needs to be ensured that all data collection and PAs are done correctly, and in line with the procedures and guidelines set by the organization. It also needs to give enough allowances and leverages to the employees to allow them to balance their personal and professional life. Nestlé believes that employee’s private and professional life should have a good balance. In the same spirit, Nestlé encourages flexible working conditions whenever possible and encourages its employees to have interests and motivations outside work. This not only maintains satisfaction with the job, it also increases loyalty, productivity and provides motivation for better performance in the future.
- 33. 32 360 Degree Appraisal System: Performa acne Appraisal system used by Nestle is a 360 degree appraisal system. This process enables the individual’s performance to be evaluated from an all-around perspective and thereby provide more accurate information on an individual’s performance over a stated time period. The concept of 360 degrees comes from the number of degrees in a circle. Every point at the edge of the circle provides a direction or a dimension to its centre. So providing an employee with 360degree feedback means that feedback comes from all directions .This leads toward validity and reliability of the performance appraisal. Centre of Expertise Hiring and requirement is the most important task performed by Centre of Expertise. It is the process on which the entire company’s future and performance relies upon. TheBusiness Partners are supposed to communicate the staff requirements of different departments, and set the job description and requirements. Contacts with universities and recruitment events are maintained to have good visibility of the Company and recruitment sources. This thing helps to achieve high performance. Training and development of Nestle: It must be admitted that the company culture has learning. All employees try to upgrade their skills and knowledge continuously. So employees are willing to learn to be recruited by Nestle. Training and development is done on-the-job. Every manager has a duty to guide and train employees for their progress Workforce Planning: Workforce planning is a process which is designed to foretell what, when how much can bring about in talent management. It is an integrated and forward looking process. It provides action plans to the managers to work in a prescribed way. This process helps the managers to avoid or decrease problems of people to take advantage of talent opportunities and to develop the talent pipeline. It builds a competitive advantage over other firms. Man Power Planning Manpower planning is a strategy for the acquisition, utilization, improvement and preservation of an enterprise’s human resources. It refers to setting up job specifications or the quantitative requirements of jobs determining the number of personnel required and improving sources of manpower. Performance related pay (PRP) Performance related pay in an extra payment system added to the base pay. The employees get this payment according to the standard of their performance. Besides, this payment is
- 34. 33 given to a company after considering how it is performing in financial context. Some forms of PRP are strategic pay, flexible pay, and variable pay. Objective Evaluation of the Organization Human resource function has significance with the onset of global competition. Human resource managers and corporate planning managers think more strategically and step by step. How intense competition impacts upon employment stability can be addressed by them. Implementing cost savings policies regarding employment and thinking with executives on the process of supporting corporate activities are not the same things. To stop downside of global competition the human resource managers should be more active and recruit and keep up efficient workforce. Planning should be done from the very beginning to stop bloating of organization. Role as a Business Partner Business Partner’s tasks and responsibilities can be clearly explained with his position in the business as a Business partner. A business partner is a link between the whole of the organization and the Human Resource Department. His main focus is on coordinating and integrating the strategies and plan of actions of different departments in line with the whole organization. He ensures that the growth objectives and plans of the departments don’t come into conflict with the mission of the organization as a whole. The Centre of Expertise is concerned with making changes and finding new ways of operating to increase the efficiency of the whole organization. How well company has managed its performance management The function of Performance management is to ensure the fulfilment of goals in an effective and efficient manner. Moreover, it watches performance of organization and process of production, employees etc. In Nestle Pakistan Line managers and HR assess formally once in a year and get feedback. Subordinate managers can interrogate for an unfair evaluation. The HR department has enlisted specific key performance indicators.
- 35. 34 Remuneration structure and promotion criteria consider individual performance. HR staff must help the management in elaborating training programs. Sufficient training programs are developed at the level of every working company that capitalizes on the availability of local regional or global resources of the group. Some training programs improve the language skills of the employees. These programs also try to consolidate corporate cohesion as well as to promote networking throughout the group. They develop and share best practices of the different management disciplines practiced in the group. E-learning programs are alternative to formal training programs. Competency profile mapping Competencies are accumulated by totalizing success factors important for obtaining good results in a particular job or in a particular company at nestle. Success factors are made up of knowledge, skills and attributes that are stated in case of particular behaviours and are exhibited by efficient performers in those works. Attributes include personal characteristics, features, motives, values or ways of thinking affecting an individual’s behaviour. Competencies in organization can be divided into two categories- personal functioning competencies that include broad success factors untied to a specific work function or industry. These competencies often notice leadership or emotional intelligence behaviour Critical Analysis of HR PERFORMANCE The performance of an organization must be analysed for the development. This analysis makes revaluation of existing strategy possible and easy to understand the faults so that organization can rectify them at once. Recruitment, training and development of employee’s caliber have been done with high standards. HR Management provides best working conditions with suitable growth opportunities. Employees must maintain rules and regulation of the country. HR Management keeps the record of the best performing employees and gives them opportunities for growth. This analysis proves the best performance standard of HR dept. in the present market. It is clear that Nestle emphasizes on personal achievement and the pay structure HR has planned for its employees and the company also mixes practices like Job Enrichment and Job enlargement, to motivate employees and to break the monotony of their Job tasks. An example of Job enlargement is the correspondent who acts both in sales and brand management department
- 36. 35 Nestle Continues Excellence (NCE) There are a separate department for continuous excellence of the performance Headed by Nadia Omer .This department mange the performance of the overall company very well. Conclusion So conclusion of our whole report is that Nestle is good in its performance but in some cases it needs to improve and there are some negative things and there are some positive things which we observe in our finding about the performance of the nestle. Nestle performance management is high but not the maximum so of the maximum performance management Nestle needs some improvement which we’ll discuss in our second part of the report. (Nestle Performance) References Nestle.com Nestle.pk Company visit (Lahore)
- 37. 36 Institute of Business and Management University of Engineering and Technology Lahore Questionnaire Agree Neutral Disagree 1. Employees, once confirmed as permanent, can feel secure in their employment with our organization. 2. When faced with economic pressures in part of our business, we work hard to find alternatives before laying staff off. 3. We are very selective in whom we hire in this organization and we let our existing and potential employees know it. 4. We are very clear about the attributes, competencies, attitudes and values that we want in a new employee 5. We use a variety of recruitment and selection tools to ensure that the people that we hire not only bring the skills and knowledge that we need but, more importantly, that they will fit with our organization's culture. 6. Our senior executives get involved in the selection process to demonstrate the importance we place on hiring the right people for our organization. 7. We evaluate our recruitment and selection process against job performance to ensure that we are bringing people in that can perform well on the job.
- 38. 37 8. We have structured our workplace so that most of our work is done in team. 9. Our work teams are largely self-managing and empowered to solve problems in their immediate work area. 10. Management rarely has to become involved in making work-related decisions at the frontline. 11. Our organization's pay and benefit package is well above industry or community norms for work of comparable value. 12. Our employees know that our pay and benefit package is well above industry or community norms for work of comparable value. 13. We provide our employees with opportunities to invest in our organization to benefit financially from their efforts to contribute to our success 14. It is clear to individuals and/or teams what has to be achieved in order to earn performance-based rewards. 15. Our organization makes a significant investment in the ongoing training and development of frontline staff. 16. Our frontline staff is multi-skilled and can take on many different work assignments.
- 39. 38 17. Our frontline staff frequently changes jobs in the interest of acquiring new skills and knowledge. 18. Work teams and/or individuals frequently review and evaluate processes, incidents, decisions and innovations to derive as much learning as they can from both success and failure. 19. Our training goes beyond job-specific, technical skills to include social skills, general problem- solving skills and broader knowledge of the organization. 20. Financial information concerning the organization is fully and openly shared with frontline employees on a regular basis. 21. Non-financial performance information is fully and openly shared with frontline employees on a regular basis. 22. Every effort is made to ensure that frontline employees fully understand important financial and non-financial information on organization performance. 23. We work hard to ensure that we apply the best performance tools and techniques that are relevant to the field in which we operate. 24. We keep up-to-date with advances in knowledge about what works (and what does not work) to improve performance in our field. 25. We work hard to equip our employees with the best methods, tools, technology, practices and techniques.
- 40. 39 26. We work hard to minimize distinctions between frontline employees and senior management. 27. We avoid the use of demeaning job titles and try to use titles that promote equality. 28. We minimize compensation and benefits differences between levels in our organization.