Organisational Behaviour of Nestle Company - Essay Example

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Organisational Behaviour Assignment 2 NESTLE TABLE OF CONTENT ASSIGNMENT COVERSHEET TABLE OF CONTENT----------------------------------------------------------------2 INTRODUCTION-----------------------------------------------------------------------3 BUILDING AND MANAGING EFFECTIVE TEAM---------------------------4 Expected------------------------------------------------------------------------------------4 Actual---------------------------------------------------------------------------------------5 Differences---------------------------------------------------------------------------------6 Recommendation--------------------------------------------------------------------------6 DECISION MAKING IN ORGANIZATIONS-----------------------------------7 Expected-----------------------------------------------------------------------------------7 Actual--------------------------------------------------------------------------------------8 Differences-------------------------------------------------------------------------------8 Recommendation------------------------------------------------------------------------9 CONCLUSION-------------------------------------------------------------------------9 WORDS COUNT ----------------------------------------------------------------------10 REFERENCE LIST-------------------------------------------------------------------10 APPENDIX------------------------------------------------------------------------------11 INTRODUCTION Nestle is the world’s leading nutrition, health and wellness company whose purpose is to provide ‘Good Food, Good Life. ” Its origin dates back to 1866 when Anglo-Swiss condensed milk company was founded in Cham. A year later, the founder of Nestle Mr. Henri Nestle opened a company in Switzerland which offered infant cereals and which later merged with the Anglo-Swiss company in 1905 leading to birth of Nestle Company whose headquarters are in Vevey, Switzerland. Since then, it has grown into a global organization spanning 461 factories in 83 countries. It has a human resource capacity of 330, 000 people in over 150 countries. It offers a broad range of products such as baby foods, bottled water, dairy and drinks among others. It is managed by geographies as shown in Appendix 1 and is headed by its chairman Peter Brabeck-Letmanthe. The management of day-to-day activities is handled by executive board members. This report aims at giving a detailed analysis and discussion of how the organization is managed and specifically, to how it manages teams and how it makes decisions. This is to evaluate whether the company management practices are in line with management theory as pertains to teamwork and decision making. As such, the report will discuss theory on effective teams and decision making in organizations, examine how the company actually conducts those practices, establish the gap between theory and practice and finally, make recommendations on best practice. I have not worked for the company before but I have researched and obtained enough information to guide the analysis from the company website and other sources such as former employees. BUILDING AND MANAGING EFFECTIVE TEAMS IN THE WORKPLACE EXPECTED Rosenhauer (2005 p. 36) defines a team as “people who work together in close proximity with each other and who interact with other teams in the workplace.” A team is formed to carry out a specific goal. A team can be functional or cross-functional depending on the organization structure and also on the management principles. A functional team comprises of members of same department or who carry out similar functions while cross-functional teams are formed by employees from different functions. Whatever the type of the team, its effectiveness is very crucial in ensuring organizational success. An effective team has various defining characteristics. First, it must have clear purpose or expectations (Heathfield, 2012). While building the team, management should explain to the team what is expected of them and this is usually in line with the company’s mission and objectives. Management is also required to provide the necessary resources required for the team to accomplish its purpose in terms of employees, time, finances and support. Another characteristic of an effective team is that it should have the right mixture of skills and abilities. When building a team, people of various diverse backgrounds and skills should be chosen so as to encourage diversity, learning and effectiveness. Another important issue is communication. Communication is vital for a team to enable effective interpersonal relations, to get information regarding the business, and continuous feedback on performance (Heathfield, 2012). Communication also allows team members to express views and share opinions hence meetings and face-to-face communication is vital. Leadership is another crucial requirement for effective teams. According to West (2012 p. 31) a leader should share responsibility for the team and encourage members to take responsibility. They should also help members to develop their skills and abilities. Reward and recognition for individual and team effort is required if a team has to succeed (Bruce et al. 2006). This will give the group motivation and enhance commitment and engagement to the purpose of the group. Most importantly, the team should have freedom and authority to conduct its affairs and make decisions hence develop a sense of ownership (Parker, 2008). ACTUAL At Nestle Company, most of the tasks are performed by various departments such as research and development, management, human resources and production. As such, each department works as a team in order to achieve the overall objective of the organization. No small teams are formed to complete a certain task. Each individual in the department has a task to perform and is evaluated based on his/her performance. Though teamwork is at the core of its beliefs, the kind of teamwork encouraged is overall organization. All employees have clear cut tasks hence they are aware of what is expected of them. However, the goals of the team or department are set by the management without consulting the employees hence they are not agreeable to all. In addition, members are given the necessary skills required to perform the tasks through formal training and also on-the-job training. Individuals are also given support as each manager is expected to be a mentor to his/her people. Communication is encouraged and employees are given constant feedback on performance which is open, honest and face-to-face. Employees are also given information regarding the business regularly. Leadership cannot be shared between members since each member has a defined task under leadership of a departmental manager who is chosen by the senior management. One can only become a leader through promotion which is rare especially for the production line staff. Rewards are individual based thus each member strives to attain ones goal and consequently hindering collaboration. Members cannot make decisions such as how the team operates since they depend on top leadership for direction. As a result, the team may not be able to accomplish its objectives thus poor performance. DIFFERENCE There are various differences and similarities between theory of effective teams in the workplace and the actual practice at Nestle. Team formation requires individuals with a mixture of skills to work together for a common purpose (Hayes, 2002). However, Nestle does not recognize the importance of having small teams rather than relying on traditional departmental teams. The team members should be allowed to divide tasks amongst themselves so that they can accept them (Bruce et al. 2006). Though expectations are clear, Nestle employees are not allowed to have a say on the tasks they perform and this may affect their motivational level leading to poor performance. Members do not have the freedom to choose their leader or share leadership as expected. Another difference is that employees are rewarded individually and not as a team. For a team to be effective, team efforts should be recognized and rewarded so as to enhance collaboration and teamwork thus improved performance (West, 32). This may be due to the company culture based on shared values which emphasizes on learning and individual development. For example, managers appoint their successors in advance and develop them and also production line workers do not participate in setting objectives (Nestle 2012). Besides, procedures are standardized in all branches therefore even if there were small teams, creativity would be inhibited. RECOMMENDATION The company should form cross-functional teams to encourage diversity of skills and ideas that are crucial for team effectiveness. Teams as well as individual efforts should be recognized and rewarded in order to motivate the members thus gain their commitment and engagement. Members should be given an opportunity to choose their leader so that he/she can be acceptable to the group hence manage the group effectively. Leadership should also be shared among members. This can be done by the departmental manager forming small groups which are autonomous. Members should also be consulted on the tasks they want to perform so that they are acceptable. DECISION MAKING IN ORGANIZATIONS EXPECTED “Decision making is one of the most important- if not most important-of all individual and group efforts within an organization” (Sims 1998 p. 40). The function is mostly carried out by senior executives although day-to-day operational decisions are made at various levels. There is a rational model of decision making standard to all organizations but the decision making model depends on the leadership in place (Shapira, 2002). The process of decision making according to Bowett (2012) involves identifying objectives, collecting information, analyzing information, choosing a course of action, communicating the actions and evaluating outcome and results. Throughout the process, an effective manager or decision maker should consult widely so as to make informed decisions (Secchi, 2011). This involves engaging the employees, shareholders, customers and suppliers. Effective communication is vital so that all concerned can know what is going on and where the company is heading. Failure to communicate can lead to resistance from all quarters. Managers at lower levels should be trained to make decisions and solve problems as they are the ones in contact with employees. Bowett (2012) notes that decision makers should be able to interpret information and admit mistakes. Besides that, a supportive environment, careful recruitment and selection as well as training should be provided. Ethical decision making is also crucial to avoid any legal constraints (Sims, 1998). This involves ethical training, honoring employee contracts and being socially responsible. ACTUAL Nestle is a very complex company hence involves complex decision making. Most of the decisions are made by the board of directors but day-to-day decisions are made by middle-level management. The process of making decisions is guided by the organization culture which is based on the principles of shared value. Under the leadership of Braeback the company has made many crucial decisions regarding expansion, diversification, mergers and takeovers and decisions concerning employees both national and international. Although employees through the management are encouraged to contribute their ideas towards decision making, most of the decisions are made by the chairman. Consultation with regional managers is only to seek their approval. However, diversity of opinions is encouraged at lower levels of the management. There is communication at all levels hence the employees are aware of what is going on. Managers get a lot of training but much is about talent development and not decision making skills. Recruitment and selection is done based on skills and abilities and also in consideration of diversity. Nestle makes ethical decisions by following its principles on shared value and having a well spelt out corporate strategy. DIFFERENCE Some differences exist between theory and practice in regards to decision making. All stakeholders should be participants in decision making and are part of an ongoing process even if they do not take part in all phases (Shapira 2002 p.5). Though the chairman consults managers before making a decision, it is more of approving the decision than contributing views and this may discourage them from giving their views or being committed to the decisions. For example, he developed an internal growth strategy which involved acquisition of new companies and doing away with mature brands without consulting them. This idea was thus very much criticised although it was successful in the end (Nestle, 2012). Management should be trained on decision making in order to make sound decisions while dealing with staff (Sims, 1998). However, Nestle concentrates on talent management and less on managerial decision making training. Employees should make decisions on issues that affect them (Bruce et al. 2006). At Nestle employees are not much involved in decision making. RECOMMENDATION Managerial training should be emphasized to give managers skills to make effective decisions. Employees and other stakeholders should be involved in decision making and their views considered so that they can own the decisions thus commitment and engagement. CONCLUSION Effective teamwork and sound decision making are key to organization success. Nestle has been successful in various areas but still more needs to be done if it needs to be recognized as a world leader in Nutrition, Health and Wellness and be trusted by all its stakeholders. The vision and mission of the company is used to direct all behavior in an organization hence sets the direction. As such, when making decisions this should be the guiding principle. The organization culture is also crucial as it shows how the company behaves. Nestle has a culture of shared values which guides all its actions but sometimes it may hinder success. Nestle needs to engage employees by involving them in decision making and also train the management on team management and decision making skills. A supportive environment and a culture that supports team work are essential for organizational performance. The formation of small cross-functional teams can go a long way in improving the effectiveness of the company not forgetting management support in terms of resources, time, and skills. WORD COUNT: 2056 REFERENCES Bowett, R., 2012. Organization decision making in business. Tutor2u. Available at: www.tutor2u.net/business/organization/decisionmaking.htm[Accessed October 8, 2012] Bruce, M., Cashel, C., Wagstaff, M & Breunig, M ., 2006. Outdoor leadership: theory and practice. USA: Human Kinetics. Hayes, N., 2002. Managing teams: a strategy for success. UK: Thomson Learning. Heathfield, S.M., 2012. 12 tips for team building. About.com. Available at: http://www.humanresources.about.com/od/involvementteams/a/twelve-tips-team.htm[Accessed October 7, 2012] Nestle Website. 2012. http://www.nestle.com Parker, G., 2008. Team players and teamwork: new strategies for developing successful collaboration. 2ed. San Francisco CA: Joss-Bass. Rosenhauer, S., Teams and teamwork as the basis of effectiveness. Germany: GRIN Verlag Secchi, D., 2011. Extendable rationality: understanding decision making in organizations. New York: Springer Shapira, Z., (ed). 2002. Organizational decision making. UK: Cambridge University Press Sims, R.R., 1998. Ethics and organizational decision making: a call for renewal. Westport, CT: Greenwood. West, M.A., 2012. Effective teamwork: practical lessons from organizational research. 3rd ed. West Sussex: John Wiley & Sons APPENDIX Appendix 1: Nestle Organization Chart adapted from Nestle.com Read More