Organisational Behaviour Formative Assessment 2 Answer

Introduction and Overview of Business

Nestle is a leading Swiss transnational food and drink processing company. It is the greatest openly held food corporation in the world. It operates over 400 factories wide across 189 nations and employs about 350000 people at the global level. It was shaped in 1905 by the union of the Anglo-Swiss Milk Company originated in 1866and Farine Lactee Henri Nestle established in 1867 (Nestle 2023). The corporation grew substantially during First World War and again succeeding World War II, developing its offering beyond condensed milk and baby formula items. Even since, the corporation has created waves in the food sector, eventually becoming the chief food corporation in the world. As a consequence, it was included in Forbes and Fortune 500 lists.

Nowadays, a few of the products of Nestle include medical food, baby food, coffee, bottled water, tea, brunch mueslis, dairy goods, confectionery, ice cream, and snacks. Over 29 of the total subsidiary brands of Nestle, report annual sales in excess of $1 billion, including Nespresso, Kit Kat, Smarties and Maggi. It also constitutes to be the major shareholder of L'Oreal which is the leading cosmetics corporation in the world (Kumari and Muralidhara 2021).

In these varying times, Nestle is operating closely to establish a optimistic future. The future for the individuals and farmers it works with, the people who enjoy its products and the natural environment on which everybody depends. Its drive is to reveal the influence of food to improve the superiority of life for everybody, today and for future generations to arise. Determined by its purpose, it lay emphasis on energy and possessions where revealing the influence of food can make the highest variance to people's and animals' lives, safeguard and improve the atmosphere and produce substantial worth for the stockholders and participants alike. Nestle is the principal health, nourishment and wellness corporation. Its mission of Good Food and Good Life is to propose customers the finest tasting, most nourishing choices in a wide range of beverage and food classes and eating events (Kee et al. 2021). Its vision is to become a leading, viable, Health, Nourishment and Wellness corporation making delivery of enhanced shareholder worth by being a favored corporate citizen, preferred employee, and ideal vendor selling ideal products.

The fundamental principles of Nestle include fair dealings, complete legal conformity, respect, and integrity. These basic principles are all geared towards becoming a highly trustworthy company. Respect, integrity, honesty, fair dealings and compliance are all attributes of a reliable business (Nestle 2023). As an outcome of its trustworthiness, the company can make entry into new markets as well as fast-growing into a leading company. It is no surprise that Nestle has been capable of instilling preferable habits in all of its workforce throughout the world.

The major purpose of the research is to analyze the strengths and weaknesses of the internal business environment, current challenges for managers and their impacts on the internal environment, assess the relationship between strategy and organizational structure, assess the importance of understanding personality in managerial work and lastly to offer a recommendation to deal with resistance from stakeholders to derive the change in the organization.

Internal Business Environment

Nestle is thriving to upkeep its attractiveness and do what is finest in all scenarios through its supreme investment in research and developmental activities to accomplish sustainability and victory in the longer term. It possesses the greatest R&D systems in the food sector across the world, 25 R&D centres and about 5000 personnel. They offer tasty and healthy picks for their customers owing to the rise in demand for vegetarian and gluten-free products with added features (Chung et al. 2020). Moreover, expanded from baby food items and came in rapidly mounting markets like health care goods, their health discipline has also made procurements to make items for individuals impacted by long-lasting illness, thus being capable to provide superior class and harmless food, offering plant-based resolutions to customers globally notify of nutrition, convenience and health as they are international. All this has placed Nestle over and above its rival firms as customer preferences evolve all the time and they are highly knowledgeable regarding what they place in their bodies. However, the current organizational structure of the company is categorized on the basis of product range and not grounded on its terrestrial operations (Akinsipe Olasunkanmi 2021). This tends to create massive power distance when it arrives to decision-making and stops suppleness in business processes. In extending its processes, it always proved to be a main issue.

The constant presence of Nestle over the ages is attributable to various internal aspects. These factors build the fortes of Nestle.

Strengths

• Worldwide existence – The active existence of Nestle in over 189 nations is beneficial to its entire and unshattered growth. The existence in these nations for over 150 years helped in building the brand in the local setting. This indicates that their product is accessible to individuals in all these nations, and it leads to a long-lasting effect on people also.
• Rising cash flows – The cash flows of Nestle have increased substantially in the past 2-3 years and this shows that the finances of the Group are healthy and these can be invested again in order to expand rapidly.
• Stronger supply chain processes – Nestle Group inspires inventions at local levels, integrates technology and is raising the traceability of raw material sources (Senturk et al. 2023). It allows the company to accomplish significant operational effectiveness.
• Digital conversion – The outlay by Nestle in digital conversion across areas such as social media, advertising, business, e-commerce, and supply chain has helped it in becoming data-driven. It allows it to meet the personalized requirements of customers and achieve superior gratification. In 2019, Nestle converted over 70 ecologies with the assistance of artificial intelligence and personalized 20% of its consumer’s contacts (Mishra and Shukla 2023).
• Faster innovation – The advent of science wide crossways all the stages and revolutionizing via partnership with local players enables Nestle to revolutionize faster and as per local demands. The foremost food multinational, Nestle has decreased the proportion of sugars by over 25% used to make its adored Carnation Breakfast Essentials. Furthermore, the corporation is also integrating totally new and eco-friendly paper wrapping for the product line to improve its sustainability.

Weaknesses

• The span of control and administrative structure – Nestle is systematized in the matrix form. That indicates that a big number of brands are under one ridge which makes it somewhat complex to accomplish a large number of separate brands, which can often lead to dissonance and conflicting interest (Leliga et al. 2019).
• Higher reliance on advertising – Nestle is mainly reliant on advertising to market its products. This raises the costs of marketing and subsequently, the higher risk linked with the yields. With disturbances coming up, such an approach will not withstand Nestle for a longer time period.
• Issues in the marketing of products – Nestle has again came across a huge backlash from persons wide across the world for not sufficiently positioning and marketing its products (Gandhi 2022). One classic instance is concerned with the marketing of breastfeeding baby formula to people in poorer nations. Illiterate mommies were using the product with contaminated water, leading to sophisticated cases of infection from the same.
• Social disapprovals – Nestle has become a major target of the media's attention several times. The entitlement to privatize water, deceptive labelling and the law case for chocolate making use of child and slave labour are a few instances that have weakened its market goodwill.

Current Challenges for Managers and Their Impacts

Global market movements influence the performance of the organization, pressurizing leaders to rethink systems, strategies and structure to observe the success of the company. Customer demand, regulations and competition are major aspects that force the corporation to consider clearly describing approaches, guide behaviours and enhance organizational hierarchy (Tien et al. 2019). The structure of the company is formed by interdepartmental partnership, team dynamic forces, and dispersed and centralized decisions. Forces of the global market induce the corporation to design approaches and tools to evaluate, control and measure performance.

Carrying out operations in the viable global market needs the corporation to board on the major pillars of performance or success. Nestle markets to third-world nations in need of nourishing food at feasible charges (Akinsipe Olasunkanmi 2021). The corporation has effective brand recognition, that offers a viable edge. However, keeping adequate skills, shared standards, and multiplicity has impacted the success of the company. Global operations indicate embracing prospects by making sure about the adequate efficiency level, employability and competent team-leading style (Caprar et al. 2022). The participative leadership tactic enables the attainment of objectives and visions as workers feel part of the company.

The main problem for Nestle is its pricing policy. The corporation is finding it intricate to upsurge prices amid growing competition and economies either slowing or going into a recession. Lesser costs of commodity, while beneficial for driving yields, also makes it compound to raise the prices. Prices contributed to over 2% points rise in sales last year, which fell short of 2.2% points (Paulino 2022).

As Nestle expand globally, it is required to comprehend its goals, mission or ideas and consider legal and ethical issues. Planning longer-term development into overseas markets needs tackling severe moral issues and verdicts to make the strategy fruitful. Common moral conditions to watch out for in worldwide markets include employment conditions, outsourcing difficulties, human rights, diversity, and political and ecological issues like taxation. The cultural deliberation can as well make or disrupt business operations globally (Walker 2022).

Organizational conflicts happen in Nestle company because of the lack of training for workers. Appropriate training is extremely essential for every company. Employees can obtain skills and techniques that can be performed in tasks. Another reason for conflicts at Nestle is poor communication between employees. They believe that each piece of information must be conveyed directly to the individual without any intervention from a third party. Effective communication is significant for the organization as it enables its employees to maximize their performance (Lee et al. 2020). As Nestle corporation functions in cultural regions and environments across the world, communication among employees at times, breaks down in regular business activities. Apart from this, organizational conflict occurred in Nestle due to the conflicts occurring in the department. It can be observed in the market and manufacturing departments wherein the marketing division tries to extend the product line to generate more distinct products whereas the manufacturing division requires to undertake greater cost of production to produce higher production cost to manufacture products. Disagreements and conflicts can occur as distinct departments have distinct objectives. It may direct in their relationship becoming as rigid and thereby lowering the reputation of the company.

With greater advancements in communication, technology, and conveyance systems, multinational companies like Nestle are in an exceptional position to succeed globally (Kitchen and Tourky 2022). With that, it means that the corporation would work in distinct time zones educating languages and social notions. The uncertainty in the global market makes it complex to succeed.

The challenges like conflicts within the company may lead associates to become irritated in case they sense as if there is no right explanation in sight, or in case they sense that their perspectives go in vain by other members. As a consequence, followers become strained out, which negatively impacts their personal and professional lives. When the company devotes too much time in resolving conflict, managers get less time for paying attention to the central aims that they are tasked with accomplishing. Conflict sources members to concentrate less on the mission at hand and more on chattering regarding fight or expelling about blockings (Hussein and Al-Mamary 2019).

Personnel are concerned in carrying out their works well to develop the corporation, feel a sense of pride for the job well performed and advance to greater positions. In the absence of training at Nestle, personnel do not comprehend how to do their tasks and none of such objectives are possible. This directs to lower self-esteem among workers, which marks in employee turnover. In addition, the rate of manufacture is lower when personnel do not know sufficiently how to complete their jobs positively (Megheirkouni and Mejheirkouni 2020). To save time, manager repeatedly delegate the job of training to personnel that have been on the work for longer time. But several times, these personnel are not given additional time to do the same. They still require to finish their own labour. Untaught employees cannot make higher-quality goods. They also deficiency satisfactory knowledge and abilities to offer satisfactory consumer service which further leads to disgruntled customers. As a consequence of this, Nestle faces declining sales if dissatisfied customers opt for competitive firms that can offer better quality goods and adequate services.

Ineffective communication can act as annoying to employees, making a upbringing ground of confusion and distrust. In case, workers do not have effective paths of communication with each other and with administration also and do not sense like they are being perceived, their commitment and loyalty to the corporation might suffer (Yip and Fisher 2022). It can result in a higher rate of turnover. A cohesive, open culture cannot exist in case there is a lack of trust. Employees and managers always desire an environment where they form relationships with each other and share their perspectives and ideas. When employees do not have adequate access to resources and people, they cannot competently perform their jobs. It can lessen their morale and the inspiration to perform well, directing to the lower productive workforce. Also, it may impact the on-time delivery of different projects which can hamper the reputation of the business.

Relevance and Challenges of Organizational Structure and Connection Between Strategy and This Administrative Structure

An organizational structure is defined as the framework that depicts how decisions are being made, how work flows between team members and the entire team and what the hierarchy of leadership seems like within the corporation. It can take on various distinct forms, on the basis of how the group would manage the information flow, chain of command, and decision-making jobs (Grass et al. 2020). A corporation having stronger administrative structure profits from enhanced communication, a well-described pyramid and the capability to create a combined corporate message. As competent as the administrative structure can be, it can also direct the issues that can direct to internal conflicts and the loss of productivity. In order to effectively upkeep the robust corporate framework, one is required to be capable to determine issues within the organizational structure and deal with them as and when they occur.

The corporation’s administrative chart typically depicts links between individuals within the company. Such relations may include executives to sub-employees, managements to managing directors, CEO to several divisions and so on. The distinct forms of association charts comprise –

• Hierarchical
• Matrix
• Flat

Nestle Corporation constitute to be a dispersed corporation that is prearranged as per the matrix assembly. Nestle, being a decentralized corporation authorizes subordinate divisions to relish a higher level of autonomy (Louafi Akraouach 2019). Though it makes main tactical decisions at the head office level, the regular processes are left up to secondary branches to arise and perform. The duty for operative decisions is pushed downcast to local levels.

The matrix administrative structure is regarded as the grouping of 2 or more distinct forms of administrative structures like functional management or project management. In addition, the matrix construction comprises both a outdated pyramid of management, wherein personnel are succeeded by a functional administrator and supplementary project managers, that can manage workforces wide across distinct divisions (Fenwick 2021). This structure offers Nestle workers the prospect to fortify their communication skills, interpersonal abilities, and new skill sets because of the scope of using more than one boss. Working external to the hierarchal construction can advantage personnel by assisting them in developing new ability sets and obtaining appreciated experience from working with distinct divisions. Perhaps, the greatest benefit of this organizational assembly is that it fetches together extremely skilled associates from distinct departments, enabling Nestle to exploit on resources it already has instead of looking for expertise and employing project team associates from external to the company.

However, there are a few drawbacks to this structure. Due to the scope of the matrix relating more than one executive, decisions at Nestle, that might be needed to permit through both executives can at times, take lengthier to process as compared to the old-style structure. Moreover, with the incorporation of numerous managers and team associates, verdicts that need numerous steps, for example, in quality declaration, can be braked down when directed by a matrix (Strikwerda 2023). This construction can also at times, lead to overloading of work on team associates as their project capacity is often in accumulation to their consistent functional responsibilities. Personnel may suffer exhaustion or overlook or flop to finish the responsibilities or have their work quality suffers because of time limitations.

The strategy refers to the roadmap laid out by the company. The basic objective of the strategy is to make sure that the company accomplish the set targets to grow and sustain in the competitive world. On the other hand, the structure is the way in wherein internal resources of the corporation get linked with each other. Precisely, the structure is concerned with distinct groups that can be formed within the company (Tien 2019). Strategy act as the major driver that decides the structure of a company. In case, the company's structure is not synchronized with the strategy, then the corporation might not be capable to accomplish the set marks.

Structure and strategy are two autonomous components in corporate that are somewhat reliant on each other. The strategy that is shaped often – identifies the structural components linked with the corporate. Few firms also use the opposite and shape approach that is grounded on the structure. Combining such forces competently directs to the unified business model that operates to accomplish usual goals. Organizational strategy and structure are linked as administrative strategy assists the corporation in describing and structuring its administrative structure (Walter 2021). The administrative structure of any company is grounded on the outcome of the analysis of the organizational strategy. The corporation will make use of these outcomes to identify its focus areas and how to position itself to accomplish success.

The structure is how one organizes the work to carry out the strategy. Establishing structure in the absence of strategy is like having a map but no destination. And simply having a strategy with no structure, outcomes in unfocused and inadequately sequenced procedures, poor utilization of resources and failure to competently leverage technology. Strategy constitutes the destination, the structure is the map and the technology, people, infrastructure and equipment are essential to serve the structure and eventually serve the strategy (Ecem Yildiz et al. 2020).

Structure undertakes a vital role in the achievement of the overall strategy of the company. Another notable factor is that both structure and strategy require to be constantly interlinked to accomplish desired outcomes.

For instance, Nestle functioned with a complex, dispersed matrix structure that allowed a greater level of autonomy and individuality within its secondary brands and corporations. In 2021, however, Nestle endured a broad restructure and was rationalized into 5 new terrestrial zones to accomplish its worldwide business (Walters 2022). These are –

• North America Zone consists of the USA and Canada. Together they depict CHF 24.7 billion in yearly sales.
• Latin America Zone consists of Mexico and Brazil, which are among the leading markets of Nestle in terms of sales. It also covers the Caribbean area and depicts $9.2 billion in yearly sales.
• Europe Zone continues to establish its category-focused working model that has directed to broad-based gains in market share. With CHF 17.7 billion in sales, this zone constantly showing innovation and momentum capabilities.
• Zone Oceania, Asia and Africa which now consist of North Africa and the Middle East region depicts $17.5 billion in yearly sales.
• Greater China Zone is one of the fastest-moving beverage and food markets in the world and provides substantial development potential for Nestle. It represents $5.7 billion in yearly sales.

As per Nestle, the drive behind such reorganization was to aid the corporation improve its environmental focus to drive progress everywhere it carries out procedures (Mees-Buss et al. 2019). By laying emphasis entirely on geographic regions and organizing several corporate units under them, Nestle has become capable to move nearer to the customers and become more alert in a fast-changing environment

Importance of Understanding Personality in Managerial Work

Gaining an understanding of one's personality can aid the employee in modifying the behaviour at work, playing to strengths, enhance on weaknesses, interacting with co-workers effectively and eventually directing to career success. Personality is defined as distinctive patterns of feeling, behaving and thinking of a person. It stems from the blend of innate outlooks and inclinations together with environmental aspects and experiences (Van Woerkom et al. 2020).

Understanding personality traits helps managers in knowing what inspires an individual. Personality often provides clues to things an individual love to do and will do for free. Working in an efficient manner with distinct personality types is advantageous to sustain a stronger team and healthy work culture. Every person can fetch something distinct to the table, whether any stronger work ethic, creative innovations or the capability to undertake action and many more. It is substantial not to underestimate such distinct strengths and contributions. Understanding distinct personalities at the workplace and avoiding the pain points brought on by such distinctions is made simpler via personality frameworks such as Big Five Model (Rau et al. 2021). This model is one of the highly recognized approaches towards defining and measuring individual distinctions in one’s personality. It is applied to aid people to obtain an improved understanding of themselves, and how they compare to others. This model can be used by Nestle's management to forecast how the workforce or potential applicants relate to others. Moreover, it can help understand how personnel might think and handle stress. The Big Five personality traits comprise –

• Conscientiousness
• Agreeableness
• Neuroticism
• Openness towards experience
• Extraversion
• Agreeableness

Each of these five personality aspects is comprised of a range between two extremes. Most people score between two ends of each trait.

As leaders look to involve and motivate others to achieve their organizations' purposes, they depend on a wide range of aptitudes. These comprise: making effective verdicts in vague conditions, interacting and following a strong vision, establishing operative working associations, practicing of the abilities of every person, being adjustable and open towards change, and abiding healthy disputes and conflict. By deeply understanding one’s personality type, one can direct others more competently by laying focus on their fortes and being conscious of any probable drawbacks as well as comprehending other fortes and necessities to succeed.

Communication act as the key to fruitful personal and business interactions. One interacts with others each day on various levels. However, one might not take the while to analyze how the natural chic of communicating affects others. Appreciating, understanding and obliging individual transformations in style of communication can improve the ability to interact in an effective way. This communication benefit will raise the effectiveness as a supervisor, employee, coach, trainer, team member or leader.

• Openness – Openness lay emphasis on imagination and vision the most out of all the 5 personality personalities. People that are higher in openness constitute to have a wide range of interests. They are inquisitive about things and other individuals and are keen to learn new stuffs and relish new experiences. However, people lower in this personality attribute are often very much outdated and may fight with intellectual thinking (Matz and Harari 2021).
• Conscientiousness – This personality trait is described by higher extents of thoughtfulness, good impulsive control, and goal-oriented behaviours. The highly conscientious individual intends to be mindful and organized of particulars. They plan and think ahead regarding how their behaviour impacts others and stay watchful of limits. On the other hand, somebody scoring lower remarks in this fundamental personality attribute is less organized and structured. They might procrastinate to get things done, at times, missing deadlines entirely.
• Extraversion – Extraversion is a personality trait featured by social ability, excitability, assertiveness and talkativeness and a greater extent of emotional expressiveness. People scoring higher in this are outgoing and intend to acquire energy in social scenarios (Furnham 2022). Being around others assists them to feel excited and energized. Whereas, people scoring lower are introverted that intend to be more reserved. They have a lower amount of energy to spend on social gatherings.
• Agreeableness – This trait covers attributes like altruism, trust, affection, kindness and other prosocial behaviours. People that are higher in this trait intend to be higher cooperative while those scoring lower intend to be highly competitive and at times, even manipulative.
• Neuroticism – This personality trait is attributed to moodiness, sadness, and emotional instability (Miranda 2020). People high in this trait intend to experience anxiety, mood swings, sadness and irritability. Those having a lower score in this personality trait constitute to be highly stable and emotionally strong.

Some other traits may include –

• Empathy – It is a crucial trait for managers. Whether a corporate manager manages a huge team of employees or works straightforwardly with the consumers as a high-performing professional, he or she should be capable to link with others on a sincere level.
• Creative – Somebody creative can make use of their imagination to make or create something. Creativity skills are applied not just to artistic roles. It needs creativity to resolve complex problems, depict information in an interesting and clear way or identifies better paths to finish the tasks.
• Flexible – Flexible people can quickly adapt to the modifications in plans like shortened timelines of projects or new requirements of clients. The capability to modify behaviours on the basis of required changes in work patterns can aid in succeeding in fast-paced companies and roles.

Conclusion and Recommendations

The strategic progress at a global level needs to take paths such as retaining research to understand the market and advert influencers to form a relationship. For instance, Nestle can build partnerships with nutrition interventions or healthcare corporations that would perform as vital agents in extending products. Previous market research assists in laying emphasis on bringing products to a new culture as it aids with the examination of market requirements. Making an entry into a new market has hurdles like language problems that multinational corporations should overcome to prosper.

Moreover, competent leaders communicate change in tangible and clearer terms and not by just indicating ideological viewpoints. Such types of interactions must be honest, frequent and concrete. And in case the change initiative does not succeed, it is crucial to interact openly with the rest of the members so that future experimentation is rewarded and not punished.

It is imperative to find a path to aid people to buy into the change. Make it clear to those that are resistant how the change will advantage them. By highlighting probable benefits and instilling excitement in the team, they will be willing for the change to arrive, as the change will be observed as something that will fetch value instead of a burden, they have no control over.

It can be concluded that Nestle is present for almost 150 years and expanded its operations in 189 nations with a wide array of product ranges. Its products are categorized into the following wider categories such as nourishment and health science, pet care, confectionary, water, ready to eat dishes and cooking aids, milk products, liquid beverages, etc. Nestle intends to have a positive brand image that directs them to garner a loyal base of customers. Their consumer relationship has assisted them in surviving the highly competitive packaged food market. The major weakness of the company lies in its organisational structure. The organizational structure of Nestle is product base, leading it complex for the management to have adequate control over the product's quality and services. There was no geographical area-based separation, which might cause delays in decision-making. In 2021, the corporation seems to simplifying its diverse operations from worldwide run to 5 substantial zones. Strategy and structure are complementary to each other. When any corporation make main changes, it should prudently think out each aspect of the structure needed to sustain the strategy. It is the sole way to execute lasting enhancements. The major challenges faced by Nestle is concerned with pricing strategy, conflicts between employees and management, and ineffective training and communication. This greatly impacts the morale and productivity of the workforce. The Big Five Model is an approach to measure personality. It lay emphasis on abstracting traits as the spectrum instead of black-and-white classes. It determines that most people are not on the polar end of the range but somewhere in between. Knowing the personality can aid in learning more about oneself and the people around. It aids in identifying strengths and weaknesses, understanding actions and feelings and controlling behaviour in distinct situations. In order to overcome the resistance to change, Nestle's management must use human-centred design thinking. The best path to handle such resistance is to lessen or prevent it. If they are truly stakeholders, they stand to lose or win as the outcome of the change initiative. Getting clear on the desired results and how stakeholders of Nestle measure success is the key.

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