Organization Structure Of The Nestle

The purpose of this report is to discuss about organization structure of the Nestle Company. The organizational structure of a company is related to certain activities that is outlined and directed subordinates to achieve the goals. The organizational structure is also related to information flow from top authorities to lower level employees. There are different types of organizational structure that are adopted by the companies based on their needs, such as hierarchical structure, functional structure, centralized structure, matrix structure, etc.

Company Background:

Nestle S.A. is a Switzerland based multinational organization that operates its business in more than 189 countries. As a food and drink processing conglomerate corporation, Nestle is known as a purveyor of candy throughout the world that is headquartered in Vevey, Vaud, Switzerland. This company also owns multiple brands in the world in bottled water, health-care products, pet products, and frozen foods can be determined on the priority basis. The company employs around 339,000 employees worldwide to conduct its business operations successfully, such as manufacturing, supplying and production. This company was established in the year 1866 by Henri Nestlé in Vevey, Switzerland (Nestle, 2022).

Organization Structure of the Nestle Company:

In order to reveal the cross-functional relationships to coordinate work efforts and optimal results, the understanding about a companies’ organizational structure is mandatory for a long-term success in the market. An organizational structure of an organization is associated with a system in which certain activities are outlined in the context of achieving the goals based on direction (Nestle, 2022). The organizational structure of the Nestle is based on decentralization in which it is organized according to the matrix structure to perform all functions effectively. In decentralized organization structure of Nestle that is matrix structure, it gives permission to subordinate branches to make decisions. Nestle as a decentralized organization permits to subordinate branches to use a proportionately high-level of independence to make own decisions in the favor of the company.

However, the major strategic decisions of the company is taken at the headquarter level in which marketing, investment, transportation and other main functions are controlled by the managing director. On the other side, the subordinate branches of this company can make decisions on its daily operations in order to derive and perform the business operations effectively (Nestle, 2022). Further, the responsibility of the subordinate branches can be seen as pushing down to local units through its operational decisions on the priority basis. At this stage, relations between people within this organization generally include managers, managing directors, engineers, quality assurance managers, etc.

The managing director of Nestle makes central decisions in most of the business operations at the global level. The finance and administration manager, HR manager, factory manager, and supply chain manager are mainly responsible to provide essential information to the managing director directly. Further, the financial department of the company manages all accounting related activities that are directly connected to the managing director. In this department, financial control manager, legal and VAT managers and general service executive help to prepare accounting data and financial statement of Nestle (Nestle, 2022).

Moreover, the management of human resource or workforce of the company is related to the Human Resource Department under which Human resource executive, cooperate affairs officer and training executive manage the employees of this company effectively. The Human Resource department of this company makes its own decisions from recruitment of the candidates to process, training and promotion of the employees. The workforce of this company are controlled at the global level from the headquartered, Switzerland. However, the subordinate offices of the company only participate to make data of needs of recruitment of new candidates, but the final decision is made by the managing director and HR department at the central level (WordPress, 2019).

Now, the production department of Nestle that belongs to production of the products is controlled by factory manager, engineers, quality assurance manager, product officer, and factory HR manager. These authorities of this company manage all the manufacturing related tasks and take responsibility of maintaining demand of the products in the market (WordPress, 2019). The production department of the company also takes responsibility to increase productivity of the employees to achieve goals of the company in which factory HR manager play essential role to motivate employees and increase their working capabilities.

At the same time, the sales of the products are managed by sales department in which supply chain manager, purchasing manager and distribution manager play essential role to satisfy the needs and expectation of the customers. Additionally, information system manager of this department provides market conditions related to the products that are considered in the production department to manufacture the products (WordPress, 2019). In sales department, customer service manager also play essential role in order to manage grievance of the customers and collects feedback about the product performance through his/her team of customer care service.

In sales department of Nestle, business excellence manager and demand and supply planting manager also play important role to increase sales of the products and maintain brand value of the company in the market. The business excellence manager of the company takes responsibility to manage and execute multiple medium to large-scale supply chain projects effectively and efficiently (Nestle, 2014). The supply planting manager communicates production manager and supply chain manager of the company and provides shipment of raw materials on the scheduled basis and reduces production delays. At this stage, the organizational structure of Nestle at the global level works effectively and provides competitive advantage in the market.

(Nestle, 2014)

Advantages of Organizational Structure of Nestle:

The advantage of organizational structure of Nestle that is matrix organization structure allows multiple departments to easily communicate and collaborate on a project. The matrix organization structure of Nestle helps employees answer to multiple managers related to any issues and resolve more quickly. This type organizational structure of this company encourages employees to contribute and place a higher value in the organization. This way of organizational structure provides opportunities to employees to work across multiple projects of the company and with various departments. At this stage, the knowledge and understanding of the employees increase skills more than one that is helpful to develop their personal and professional growth (Nestle, 2014).

Further, the organizational structure of Nestle provides resources to maximize the business operations at the large level using equipment and employees and sharing information across the projects. Apart from this, project managers can also work in the areas of their expertise under this organizational structure instead of working on multiple projects.

Conclusion:

After discussion about the organizational structure of Nestle, it can be stated that organizational structure is associated with a system in which certain activities are outlined in the context of achieving the goals based on direction. The organizational structure of the Nestle is based on decentralization in which it is organized according to the matrix structure to perform all functions effectively. The organizational structure of the Nestle is based on decentralization in which it is organized according to the matrix structure to perform all functions effectively. In decentralized organization structure of Nestle that is matrix structure, it gives permission to subordinate branches to make decisions. The organizational structure of Nestle allows multiple departments to easily communicate and collaborate on a project.

References

Nestle. (2014). Organizational Analysis. Retrieved from: http://imba.tjufe.edu.cn/__local/E/FF/41/0768DE2F22A3FF59F3BD86E8D7C_09CFBC16_8A3D8.pdf?e=.pdf

Nestle. (2022). Management. Retrieved from: https://www.nestle.com/aboutus/management

WordPress. (2019). Nestle´s organization. Retrieved from: https://nestleanalysis2019.wordpress.com/2019/01/20/nestles-organization/