Internship Report of Nestle

September 22, 2017 Philosophy

Internship Report Internship Report Nestle Kabirwala Factory Nestle Kabirwala Factory 20 July 2011 to 29 August 2011 20 July 2011 to 29 August 2011 PREFACE Internship at Nestle Pakistan Ltd. (Kabirwala Factory) was an attempt to seek experience of operational management of a successful multinational company. The idea was to understand the corporate strategies and operational activities, while developing skills needed to thrive, of one of the leading global multinationals whereas applying the knowledge and skills acquired during the academic career.

This wonderful experience of just six weeks proved to be a high inclination in the graph of my personal learning. Acknowledgement I would like to acknowledge and extend our heartfelt gratitude to Allah Almighty I made all things possible, and then we would like to thank the Nestle HR team at KBF without whose cooperation we wouldn’t have learned all we did. Most importantly I would like to thank my parents and teachers who made me what I am by teaching me all I know today. Table of contents Introduction to NESTLE NESTLE in Pakistan Introduction to NESTLE KBF Departments of NESTLE KBF Financial Analysis Department in which I Work

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Application of class room concepts PESTEL Analysis SWOT Analysis Recommendations INTRODUCTION OF THE COMPANY NESTLE’S HISTORY: Nestle was founded in 1866. In the 1860s Henri Nestle, a pharmacist, developed a food for babies who were unable to be breastfed. His first success was a premature infant who could neither tolerate his own mother’s milk nor any of the usual substitutes. The value of the new product was quickly recognized when his new formula saved the child’s life, and soon, Farine Lactee Henri Nestle was being sold in much of Europe. In 1905 Nestle merged with the Anglo-Swiss Condensed Milk Company.

By the early 1900s, the company was operating factories in the United States, United Kingdom, Germany and Spain. World War I created new demand for dairy products in the form of government contracts. By the end of the war, Nestle’s production had more than doubled. The first Nestle factory to begin production in the United States was opened in Fulton, Oswego County, New York. The factory however was closed in 2001, after the company decided that the cost of restoring, and updating the factory was not worth the effort. Employees of the factory were furious, and raised the company flag upside down the day the closing was announced.

NESTLE TODAY: Nestle is now the world’s largest food company. It is present on all five continents, has an annual turnover of 74. 7 billion Swiss francs, runs 509 factories in 83 countries and employs about 231,000 people the world over. The Company owes its current status to the pioneering spirit inherited from its founders which continues to inspire it, to its concern with quality and to its constant search for new ways of satisfying man’s nutritional needs. Wherever possible, it sets up factories locally, employees personnel from the country concerned and relies on indigenous raw materials.

Its agricultural services provide assistance to improve the quality and yield of the raw materials it uses. Much attention is devoted to professional training and to the integration of the Company in its economic and social environment. NESTLE- THE NAME: Henri Nestle, the founder of “Nestle” created the trade-mark of the Nest, a translation of his last name. In German, Nestle means “Little Nest. ” The symbol showing 2 young birds being fed by their mother perched in a nest on an OAK tree depicts in the motherhood, the arm, and loving, caring, protective and sincere feelings of a mother for her younger ones.

It is universally understood that nobody can love, care, feed and protect the young ones other than the mother. So, this symbol helps to give a visual sign that nobody other than Nestle can care about its consumers friendly. It shows that the Nestle provides the purest food product to its consumers because it is as sincere with them as a mother. It is universally understood that this symbol showing two young birds being cared by their mother in a nest in a tree, reflects the maternity and affection, nature and nourishment, family and tradition, and thus helps to draw a visual link between the name, “Nestle” and its products.

MISSION STATEMENT: At Nestle, we believe that research can help us make better food so that people live a better life. Good Food is the primary source of Good Health throughout life. We strive to bring consumers foods that are safe, of high quality and provide optimal nutrition to meet physiological needs. In addition to nutrition, health and wellness, Nestle products bring consumers the vital ingredients of taste and pleasure. As consumers continue to make choices regarding foods and beverages they consume, Nestle helps provide selections for all individual taste and lifestyle preferences.

Research is a key part of our heritage at Nestle and an essential element our future. We know there is still much to discover about health, wellness and the role of food in our lives, and we continue to search for answers to bring consumers Good Food for Good Life. VISION STATEMENT: “Nestle Norden’s aim is to meet the various needs of the consumer everyday by marketing and selling food of a consistent high quality”. Here is important to mention objective of 2014 is to: “To achieve or earn 100 Billion revenue ; EBIT up to 14%” NESTLE SLOGAN: “Good food, Good life” NESTLE LOGO: “A symbol of the highest quality”

Nestle Corporate Rule: Nestle continues to maintain its commitment to follow and respect all applicable local laws in each of its markets. Competitive Advantage: Quality, skills, R;D expertise are its competitive advantages. Corporate Strategy: Nestle corporate strategy is quite mature like most Multi Nationals. They have state of the art that helps in all operations from ordering raw materials to production, forecast, warehousing, logistics and sales. It’s a very well integrated software that keeps the management well aware of all progresses and plays a vital role in their overall business strategy.

The clients that nestle targets are upper middle class mostly. The current strategy of Nestle is to produce unique products in accordance to changing customer preferences. The product produces will be of superior quality commanding premium prices, which will be in accordance to company’s superior image. NESTLE brands: Nestle Brands come in a diverse range widening from Liquid and Powdered Milk to Cereals and Nestle Waters to Juices and Ghee. Following are a few of Nestle Brands in the Pakistani Market: NESTLE IN PAKISTAN

Nestle has been serving Pakistani consumers since 1988, when Nestle parent company, the Switzerland-based Nestle SA, first acquired a share in Milkpak Ltd. Today Nestle is fully integrated in Pakistani life, and is recognised as producers of safe, nutritious and tasty food, and leaders in developing and uplifting the communities in which we operate. Nestle Pakistan ensures that our products are made available to consumers wherever in the country they might be. Convenience is at the heart of the Nestle philosophy, and its aim is to bring products to people’s doorsteps.

BRANCHES IN PAKISTAN Nestle Pakistan has its branches in the following major cities of Pakistan: 1. Lahore 2. Islamabad 3. Kabirwala (factory) 4. Sheikhupura (factory) 5. Karachi Headquartered in Lahore, the company operates two production facilities at Sheikhupura and Kabirwala and has recently acquired three bottle water companies in Karachi and Islamabad. Through its effective marketing and a vast sales and distribution network throughout the country, it ensures that its products are made available to consumers whenever, wherever and however.

Nestle is a customer and profit oriented organization rather than system and strategy oriented. The mechanics of generating profit are low-cost production and high-price sales. The company meets its raw milk requirements through its raw milk requirements through direct purchases from the farmers under its self collection programmed from over 3000 villages, spread over an area of about 8000 Sq. Km. in Punjab. Nestle took a major participation in Milkpak Ltd in 1988. After it assumed the management of the company in 1992, Milkpak ltd. was renamed Nestle Pakistan.

INTRODUCTION TO NESTLE KABIRWALA FACTORY Kabirwala factory was established in 1983. Located in the heart of Punjab province, Kabirwala Dairy Limited (its then name) started its operations with the production of UHT milk in1984. It was taken over by Milkpak Ltd in 1990. Maggie 2 minutes noodles and milk powder plant started their productions in 1992 and 1996 respectively. In 1996 UHT production was shifted to SKP while production of Nestle Culture Butter started in 2000. Dry mixing line was installed in 2002 to produce Every Day tea whitener, while Desi Ghee line was installed in 2003.

On February 7, 2005, we have made a successful GLOBE GO LIVE that shall perform as a facilitator for us to achieve long-term business growth. As a result of management commitment and dedicated effort and hard work of Kabirwala factory staff at all levels it got the high status in milk powders category amongst all the Nestle factories around the world in 2001. It was achieved because of continuous improvement drive and passion to become best in the World. Another contribution of KBF is its share in Target 2004+ cost saving initiative while Quality Assurance has been achieving excellence in the test ratings for the last three years.

Senior management and KBF staff is fully committed to maintain its status through capacity improvements using latest technologies maintaining the quality of the products with high productivities and efficiencies at minimum possible costs. KBF is also shaping in line with Globe implementation and Nestle Pakistan 2010 Vision. DEPARTMENTS: Nestle Kabirwala is headed by the Factory Manager of the company. Presently Mr. Marlou Constantino is performing the services of the Factory. Directly reporting to the Factory Manager are the fourteen major Departments. i. e; * Finance & control Department * Human Resource Department Logistics Department * Safety health & Environment Department * Industrial Performance Department * Engineering Department * IT Department * Application Group * Standardization Department * Liquid Dairy Department * Powder & Noodle Department * Quality Assurance Department * Technical Training Department * Nestle Distribution Channel BASIC PROCESSES: Milk Collection Centre Milk Collection Centre Powder Plant Powder Plant Milk Standardization Milk Standardization NIDO & Everyday NIDO & Everyday Noodles Plant Noodles Plant Maggie Noodles Maggie Noodles Raw Material Raw Material Nestle Milkpak

Nestle Milkpak Mobile Tankers Mobile Tankers Reception Silos Reception Silos Liquid Dairy Plant Liquid Dairy Plant First of all the milk is collected from number of collection centers through large tanks which are received at reception silos. After certain testing by the Quality and Assurance Department the milk is approved or rejected . Then it goes to STD (Standardization) where certain amount of fat is added to milk to equalize its consistency. After fat some nutritions are added to it. Then the milk is sent for UHT (Ultra High Treatment) where it is boiled and then immediately sent to a cold state.

Some of it goes for Milk Pak and some is sent further to make cream. The other part of milk goes to Powder Plant where water is evaporated from milk to make Everyday and NIDO. Noodles are made from wheat and spices which have other suppliers and have other machinery within the Powder Plant. Financial analysis Ratios| 2010| 2009| 2007| Industry Average2007| Overall Impact| Liquidity Ratios:| Current Ratio| . 851| . 856| 0. 94| 0. 88| Ok| Quick (Acid-Test) Ratio| . 275| . 257| 0. 47| 0. 45| Poor| Activity Ratios:| Inventory Turnover| | | 7. 17| 7. 10| Good| Average Collection Period (days)| 15. 5| 15. 65| 4. 39| 3. 09| Good| Average Payment Period (days)| 95. 17| 59. 43| 52. 78| 50. 69| Poor| Total Asset Turnover | 2. 243| 2. 214| 1. 78| 1. 8| Good| Debt Ratios:| Debt Ratio | . 75| . 76| 0. 74| 0. 78| Poor| Time Interest Earned Ratio| 12. 10| 10. 47| 5. 36| 6. 95| Good| Fixed Payment Coverage Ratio| | | 4. 03| 6. 3| Good| Profitability Ratios:| Gross Profit Margins (%)| | | 28. 1| 28. 1| Ok| Operating Profit Margins (%)| | | 12. 4| 12. 25| Good| Net Profit Margins (%)| 7. 9| 7. 3| 6. 4| 6. 4| Good| Earnings per Share (rp. )| | | 39. 81| 31. 6| Good| Return on Total Assets (ROA) (%)| 17. 9| 16. 1| 11. 4| 11. 64| Good| Return on Common Equity (ROE) (%)| 73. 6| 67. 8| 43. 9| 53. 21| Good| Horizontal Analysis| Regular| Indexed| Rupees in ‘000| | 2008| 2009| 2010| 2008| 2009| 2010| | Issued, subscribed ; paid up capital| 453496| 453496| 453,496| 100| 100. 00| 100. 00| Share premium| 249527| 249527| 249527| 100| 100. 00| 100. 00| General reserves| 280000| 280,000| 280,000| 100| 100. 00| 100. 00| Accumulated profits| 3405824| 3443932| 4598850| 100| 101. 1| 104. 7| Total equity| 4388847| 4426955| 5581873| 100| 100. | 127. 1| Long term finances| 5139875| 4210750| 5573750| 100| 81. 9| 108. 4| Deferred taxation| 131933| 1531945| 1705508| 100| 116| 129. 2| Retirement benefits| 351968| 215925| 229114| 100| 61. 3| 65| Liabilities against assets subject to finance lease|  1777582| 118275| 55415| 100| 66. 6 | 31. 2 | Non current liabilities| 6988758| 6076895| 7563787| 100| 86. 9| 108. 2| Current portion of long term finances| 54042| 1322442|  57786| 100| 244. 7| 106. 9| | | | | | | | Short term borrowing- unSecured| 300000| 105375| 2143750| 100| 0| 0| Short term running finances nder markup arrangements – secured| 1924287| 756362| 2780843| 100| 39. 3| 144. 5| Customer security deposits-interest free| 127884| 105686| 128857| 100| 82. 6| 100. 7| Trade ; other payables| 2798185| 3746286| 4633932| 100| 133. 8| 165. 6| Interest ; markup accrued| 102173| 46979| 61404| 100| 45. 9| 60| | |  |  | |  |  | Current liabilities| 5306571| 8083130| 9806572| 100| 152. 3| 184. 8|  | Total equity ; Liabilities| 16684176| 22952232| 22952232| 100| 111. 4| 137. 5|  | Property, plant ; Equipment| 9464373| 10700874| 11370611| 100| 113| 120| | | |  | | |  |

Capital work-in-progress| 1,382401| 914956| 3076472| 100| 66. 18| 222. 5| Tangible fixed assets| 10846774| 11615830| 14447083| 100| 107| 133. 1| Intangible assets| 49744| 7106| 16735| 100| 14. 2| 33. 6| Long term loans ; advances| 98544| 113490| 125674| 100| 115| 127. 5| Long term security deposits| 5036| 5026| -| 100| 99. 8| 194. 9| Stores ; spares| 804647| 868984| 1050804| 100| 107. 9| 130. 5| Stock in trade| 2488573| 3895038| 4602019| 100| 156. 5| 184. 9| Trade debts| 456813| 241715| 124499| 100| 52. 9| 27. 62| Current portion of long term loans ; advances| 26615| 21012| 19149| 100| 78. 9| 71. | Advances, deposits, prepayments ; other receivables| 1488103| 1503009| 2048936| 100| 101| 137. 6| Cash ; bank balance| 419327| 315770| 505516| 100| 75. 3| 120. 5| Current assets| 5684078| 6845528| 8352923| 100| 120. 4| 146. 9|  | Total assets| 16684176| 18586980| 22952232| 100| 111. 4| 137. 5| Horizontal Analysis| Regular| Indexed| Rupees in ‘000| Profit & Loss Account| 2008| 2009| 2010| 2008| 2009| 2010|  | Sales-net| 34183847| 41155822| 51487302| 100| 120. 3| 150. 6| Cost of goods sold| 25231532| -29256902| -37608733| 100| 15. 9| 149| Gross profit| 8952315| 11898920| 13878569| 100| 132. 9| 155|  |

Distribution & selling expenses| -3890352| -5238488| -5709078| 100| 134. 6| 146. 7| Administration expenses| -956816| -1085121| -1311637| 100| 113. 4| 137| Operating Profit| 4105147| 5575311| 6857854| 100| 135. 8| 167|  | Finance cost| -557325| -442050| -513081| 100| 78. 9| 92| Other operating expenses| -1382138| -1091149| -819084| 100| 79| 59. 2| Other operating income| 61800| 144145| 170491| 100| 233. 2| 69. 6| Profit before taxation| 2227484| 4186257| 5696180| 100| 187. 9| 275. 8|  | Taxation| -674590| -1181124| -1583331| 100| 175| 255. 7| Profit after taxation| 1552894| 3005133| 4112849| 100| 193. | 264. 8|  | Vertical Analysis Vertical Analysis| Percentage (%)| | Balance Sheet| 2008| 2009| 2010| | Issued, subscribed & paid up capital| 2. 718| 2. 4| 1. 9| Share premium| 1. 49| 1. 3| 1. 08| General reserves| 1. 67| 1. 5| 1. 21| Accumulated profits| 20. 4| 13. 1| 20. 03| Total equity| 26. 30| 23. 81| 24. 31| Long term finances| 30. 8| 22. 65| 24. 28| Deferred taxation| 7. 90| 8. 2| 7. 43| Retirement benefits| 21. 09| 1. 16| 0. 998| Liabilities against assets subject to finance lease|  1. 064| 0. 63| 0. 241| Non current liabilities| 41. 88| 32. 69| 32. 95| | | |  |

Current portion of non current liabilities | 0. 32| 7. 1| 0. 251| Short term borrowing from associated company| —–| 11. 32| 9. 34| Short term running finances under markup arrangements-secured| 11. 53| 4. 06| 12. 11| Customer security deposits-interest free| 0. 766| 0. 56| 0. 56| Trade & other payables| 16. 77| 20. 15| 20. 18| Interest & markup accrued| 0. 61| 0. 25| 0. 26| Short term borrowing secured| 1. 79| —-| —-| Current liabilities| 31. 80| 43. 48| 42. 72| | Total equity & Liabilities| 100%| 100%| 100%| | Property, plant & Equipment| 56. 72| 57. 57| 49. 54|

Capital work-in-progress| 0. 82| 4. 92| 13. 40| Tangible fixed assets| 65. 01| 62. 49| 62. 94| Intangible assets| 0. 29| 0. 038| 0. 072| Long term loans & advances| 0. 59| 0. 61| 0. 54| Long term security deposits| 0. 03| 0. 02| 0. 042| Stores & spares| 4. 82| 4. 67| 4. 57| Stock in trade| 14. 9| 20. 95| 20. 04| Trade debts| 2. 73| 1. 30| 0. 55| Current portion of long term loans & advances| 0. 15| 0. 11| 0. 083| Advances, deposits, prepayments & other receivables| 8. 91| 8. 08| 8. 92| Cash & bank balance| 2. 51| 1. 6| 2. 02| Current assets| 34. 06| 36. 82| 36. 82| | Total assets| 100%| 100%| 100%|

In the vertical analysis of the balance sheet, it can be seen that the owner’s equity percentage in 2010 has increased only due to the increase in accumulated profits, where the percentage of other equity components has decreased in 2009. Because of the long term finances in 2009, the non current liabilities portion increased but as the finances were paid and a few portion of asset subject to finance lease was added to the assets of nestle, the non current liabilities decrease in 2010. Where the decrease in current liabilities in 2010 is because of the payments to the payables and undeclared dividends for the share holders.

But it is showing a better combination of low liabilities & higher equity in this year. Now as far as assets are concerned, the tangible fixed assets percentage has improved in the overall assets during the year 2009, because of installation of new plant & equipments, and in 2010, because of the addition of assets subject to finance lease. Where the percentage of intangible asset in 2008 is higher in the total assets as Globe (SAP) was capitalized during the year, but in the other years, the amortization reduces the intangible assets. The overall percentage of current asset decreases during 2009 and 2010.

But the best combination of assets can be observed in the year 2008 with an optimum percentage of tangible and current assets. Vertical Analysis| Percentage (%)| | Profit & Loss Account| 2008| 2009| 2010| | Sales-net| 100%| 100%| 100%| Cost of goods sold| 73. 8| 72. 5| 73. 04| Gross profit| 26. 18| 28. 6| 26. 95| | Distribution & selling expenses| 11. 38| 12. 72| 11. 08| Administration expenses| 2. 8| 2. 63| 2. 54| Operating Profit| 12. 00| 13. 54| 13. 31| | Finance cost| 1. 63| 1. 074| 0. 99| Other operating expenses| 4. 04| 2. 651| 1. 590| Other operating income (+)| 0. 180| 0. 350| 0. 331| Profit before taxation| 6. 516| 10. 71| 11. 06| | Taxation| 1. 973| 2. 869| 3. 07| Profit after taxation| 4. 542| 7. 30| 7. 98| It is very interesting to see that the COGS percentage remains almost same for every year. Means as the sales are increasing, COGS is increasing with the same proportion along with almost equal profit margins. As such no difference of percentage combination is observed here. It shows that Nestle is not improving in terms of profits as the percentage of profits, expenses & COGS are also increasing in the same manner, showing the same kind of percentage combination for the last three years. Department in which I work: Human Resource Department

HR is dedicated to their employees, and ensures that they have all the right people with the right skills, in the right places at the right time. Understanding that their people are the bedrock of all their business strategies, it is their mandate to enhance their skills with cutting-edge training and provide them with world-standard facilities. They select flexible, innovative people who are ready to confront new challenges and make a difference. Their groundbreaking Management Trainee Programmed aims to develop talented young men and women and help them achieve their potential in a dynamic and enabling environment .

Over a hundred people travel out of the country every year to take advantage of their international training and development events. Functions of HR 1. Recruitment They take a special sort of person to come and work at Nestle Pakistan. That’s why, when selecting candidates, they look for a set of interrelated characteristics encompassing three key areas: knowledge, personality and motivation.

Professional Knowledge : The class of the degree you have obtained, though very important, is not the only criterion for selection. Other experiences during their studies, previous jobs, assignments, language theses and any other significant extracurricular activities and achievements, are also given the right. They look for candidates who can identify a problem, analyze it, look at different options, and come to reasoned conclusions. Personality: To succeed at Nestle Pakistan, you need more than professional knowledge.

You need a flair for the field of activity of their choice, an open mind, and a willingness to dig in and learn new skills and ideas. They’re looking for applicants who are dynamic and communicative. People, who can listen, understand and integrate the opinion of others, people who can express their ideas clearly, both verbally and on paper. They want people who like to negotiate, even with very different partners, and to solve problems in complex situations. They like candidates who show leadership, inspire others, and are self-confident, yet realistic.

People who have a positive attitude to work and are willing to work hard, even under pressure. Motivation: While they expect loyalty to their company, they expect their people to be critical and suggest improvements wherever necessary. They like people who are motivated themselves & can motivate others. Recruiting process Applying for a current job / graduate program / internship: Look through the vacancies and choose which you are interested in . Create your CV by filling out the online form. Once the application is complete, you will receive a confirmation message telling you that it has been received and is being processed.

Receiving CVs: They will review and select CVs that best match open jobs. Only completed CVs will be taken into account. Only selected candidates will be contacted. In any case, you will receive an e-mail telling you when the job you applied for has been filled. Register for our talent pool: If there is no job opening suitable for you, you can still register your details in our database. You will then be considered as a potential candidate for new up coming positions. They regularly review CVs and jobs to try to match registered candidates with job openings.

You will only be contacted if they find a suitable match. The Interview Process Graduate Program Applicants : Regular group interview sessions are held throughout the year for most of the Graduate Programs. This is a one-day sessions that consists of discussions about potential jobs and career developments, individual interviews with HR and line managers, group and/or individual case studies. If you are successful at the group stage, you will be invited for an individual interview day with HR and line managers. Professional applicants:

You should expect a series of individual interviews with HR and line managers. These will generally focus on your background and motivation as they’ll as how you likely fit Nestle’s culture and values. Internships applicants: You will be interviewed by HR as they’ll as a line manager. These interviews will generally focus on your background and motivation as they’ll as how you likely fit Nestle’s culture and values. 2. TRAINING Management Trainee Programmed: The Management Trainee Program is the place for young, bright and hardworking graduates.

They hire fresh graduates as potential managers to develop new competencies and skills through on-the-job development. People are hired in one of various departments at inductee level on a 12-month training program. Once they’ve completed the program, they will be assigned independent responsibilities supporting the company’s business needs. They begin sourcing Management Trainees in January. Preliminary interviews and screening is organized according to the graduation schedules of Pakistani and foreign universities, and are followed by interviews with senior management.

Employee Nutrition Training Building a continuous nutrition learning culture within Nestle is a key element in their journey to become a nutrition, health and wellness company, to provide profitable growth in the future. To support this objective, they have developed the NQ (Nutritional Quotient) training program for employees, based on the principle that nutrition is everybody’s business at Nestle, irrespective of the area in which employees work. Nestle’s expert nutrition knowledge is long-established, centered on the activities of Nestle Nutrition and our R&D network.

The NQ program is designed to widen and increase the knowledge base among employees in other job functions, giving everyone the confidence to apply this knowledge in their work. The program combines nutritional knowledge with commercial application. For example, when communicating with consumers about balanced diets, the knowledge gained by Nestle employees through the NQ program will help make nutrition and wellness tangible to consumers, ensuring that Nestle is regarded as a knowledgeable partner in nutrition matters.

Not only this – a major aim of the program is also to help employees make informed and healthy nutrition choices for themselves and their own families. A modular program NQ training comprises engaging modules suitable for all employees, from the Executive Board to plant operators, and leverages the nutrition expertise of Nestle scientists and health marketing specialists. Implementation began in 2007, with Nestle nutrition experts and marketing specialists taking part in “train the trainer” sessions across our zones to support the cascade of knowledge to all employees. A complete toolkit

The NQ program toolkit comprises a suite of materials for trainers, including training manuals and slide sets. For trainees themselves, learning takes place in an engaging way using a variety of media and formats, including interactive games, motivational video content and an on-line quiz. This is used to measure collective progress and to allow each trainee to evaluate, in an entirely confidential way, his or her personal lifestyle choices. The toolkit also comprises awareness-raising and motivational material that can be used and adapted to meet local needs, including posters, questionnaires and certificates. Ongoing development

As nutrition and their insights into nutrition evolve, so too will their NQ Nutrition training, helping Nestle employees to keep abreast of new developments and maintain a high level of credibility through the breadth and depth of their nutrition expertise. 2. Internships: Internships are a great way to apply the knowledge and skills that are developing at universities and get experience in a leading corporation. Nestle offer project-based internship positions in various departments at Nestle Pakistan. People may be hired as an intern at various points during their academic career: during undergraduate study or graduate school.

Most internship assignments are offered during the summer months and generally run for 6 to 8 weeks. At the end of the internship intern will be required to submit a project or program report to the company on the topic assigned to them at the beginning of the internship program . If they impress them with their talent & hard work, they may be considered for employment opportunities after they have completed their studies. 4. A SHARED RESPONSIBILITY: HR managers and their staff are there to provide professional support in handling people matters but should not substitute themselves to the responsible manager.

Their prime responsibility is to contribute actively to the quality of HR management throughout the organization by proposing adequate policies, ensuring their consistent application and coherent implementation with fairness. Acting as business partners, the HR manager advises and offers solutions which results in positive impact on the organization’s effectiveness. The communication skills of the HR staff must be appropriate to deal with all delicate matters as they occur frequently in human relations issues.

They gain their credibility not only from their professional contribution but also through the care and the excellence of their communication skills. 5. Industrial relations: Nestle upholds the freedom of association of its employees and the effective recognition of the right to collective bargaining. Nestle wishes, also through its relationship with unions and other representative associations, to sustain the long-term development of the Company, both to the benefit of the employees and of the Company, by maintaining a level of competitiveness adapted to its economic environment.

Industrial relations are a clear responsibility of local management and will be handled at the appropriate level. l In dealings with unions, it will be ensured that management prerogatives be properly maintained. The fact that Nestle is more people and product than systems oriented is reflected in the way HR is functioning and is organized. Processes and systems as they’ll as professional HR tools are there to support HR management but never to the detriment of the human dimension. The human perspective should be present at all times and under all circumstances.

The HR function should report to the manager responsible for a defined operation (Region, Market, Country, and Factory) with a functional relation to the market HR according to the size of that operation. The HR manager should not only have the skills and competencies from a purely professional standpoint but also have the charisma and the credibility to be a trustworthy partner to her/his colleagues. Whereas the HR function should indeed provide flawless administrative support, its main role is to add value to the business and to play a proactive role in every situation where HR action is required.

The HR contribution aims in the first place at optimizing the overall company performance through improving people performance. With the evidence that the human capital is of increasing importance, HR plays indeed a pivotal role in the conception and implementation of the people strategies that impact financial results and the organization’s overall reputation and effectiveness. AS AN INTERN: I worked as an intern in the HR department of Nestle KBF and all the HRM activities of Nestle KBF were performed by the HR department. HRM is basically the management of human resources.

HRM is philosophy, produces techniques, tools that are used to manage human resources. Basic structure of HR at Nestle KBF HR Manager (Sajid Mukhtar) HR Manager (Sajid Mukhtar) IR Executive Tanveer Kazmi IR Executive Tanveer Kazmi Public Service Officer Liaquat ALi Public Service Officer Liaquat ALi HR Executive (Atta Husnain) HR Executive (Atta Husnain) OD Executive (ShaziaParveen) OD Executive (ShaziaParveen) BS Assistant Sheikh Sohaib BS Assistant Sheikh Sohaib BS Assistant Kashif Khalid BS Assistant Kashif Khalid I worked under the supervision of sir Atta Husnain .

His major task was to organize different trainings and awareness programs for the management as well as the non-management staff of the organization. HR dept. was involved in a project NCE (Nestle continuous excellence). The major goal of initiating was to get the maximum output with zero waste while giving 1oo% efforts and to work as one team. As the slogan shows: 0 zero waste 1 one tem 100 hundred percent engagement NCE project comprises of three pillars: * Goal alignment * Leadership development * Compliance The first task goal alignment was done by the IP(Industrial performance) Dept. nd once the goals are identified and set then further would be continued by the HR Department. For that HR Department developed a leadership activity plan and different questionnaires were made. The purpose of questionnaires was to make an assessment that what employees of Nestle KBF know about NCE. All this was further helpful for the audit which was expected in the next month. The audit team can ask any question to anyone working in the factory so that they can pass through the NCE Gate NCE gate is linked to the TPM (Total Performance Management). TPM cannot be implemented until or unless the whole Nestle KBF can pass this gate.

After successfully passing the audit Nestle KBF would be allowed to implement TPM. HR & I: HR & I was the main project which was assigned to the intern in the HR Dept. It was all about what the employees in the Nestle KBF think about HR processes, Its performance and overall HR Dept. so that necessary changes could be made accordingly for the satisfaction of the employees. The survey questionnaire was made by the head office and it was an online survey and the feedback was directly sent to the head office so there were very less chances of any type of biasness. There were 467 permanent employees who hay o fill the questionnaires. questionnaire for management and management staff was different. Almost 40-41 questions were included in the management questionnaire and for non-management staff there were 17 questions. The purpose of survey basically to assess what the employees actually think about the HR Dept. or either they are satisfied with the performance of HR Dept. or not. I and three other interns under the supervision of sir Atta were responsible to complete the survey. The deadline for the survey was just two weeks. Our task was basically to convince, motivate and guide people about the survey.

We used to convince them that to fill the questionnaires is ultimately their benfit. it was very difficult to convince employees so that they can come in give their feedback. The questions included in questionnaires were in English and thus it was difficult to understand especially by the non-management staff so my task was to guide those people and also to let them understand what the questions mean. There were questions like: * I am aware of the performance appraisal process * Selection of employees is fair and transparent * HR team is accessible to me * Medical help desk service is available whenever I need etc

Following options were given for the answers: 1. Strongly agree 2. Agree 3. Disagree 4. Strongly disagree The employees can choose one of these options and then give their feedback. Through the feedback of management and non-management staff the performance of HR Dept. was going to be evaluated and then after the results of survey new strategies were to be made and implemented according to the changing needs of the employee and to make them satisfied. At that time, the only task was to complete the survey within two weeks and to take the feedback of each and every permanent employee of the organization. t was very difficult to cover all the employees within two weeks. We made a strategy and focus on employees working in shifts and finally after putting all of our efforts get the feedback from 98% of the total employees. The survey result was 98% and Nestle KBF stood 2 on the victory stand of HR & I survey in the whole Pakistan. This was a great achievement and we were appreciated a lot. This was a great experience. I gain a lot of confidence and patience and practical knowledge. Application of Class-room Concepts & My Learnings during Internship Industrial Performance is an integrated department in Nestle.

It deals with all the technical departments frequently and performs a cross-functional work. That is why, doing internship here with the IP, Nestle Kabirwala Factory, I have been able to witness & apply various class-room concepts in the department. A few of these are: Business Communication As the IP team has influence & support from the other departments of the Kabirwala Factory, Sheikhupura Factory and Nestle Head Office, Lahore, therefore, they are especially aware of the importance of business communication in their work.

I also experienced my learnings of this course while interacting with the Corporate Manager, Project Managers, Factory Manager and other Head of the Departments while taking their follow ups on various issues and discussion regarding my project. Business Maths & Stats Statistical analysis is one of the major concerns of IP. They use statistical formulas quite often. Their forecasting and scenario building involves this course as a very important component. They based all this on ratios & probabilities.

Variance in the resources, quality & materials are another aspect, for which Variance Meetings are arranged on weekly basis. Business Research Methods On a departmental level, I have not as such witnessed this course implementation. But as far as my internship is concerned, this course plays a very major role in identifying the major problems occurring in the factory regarding employee involvement in GA. This helped me in sampling, preparing questionnaire, conducting survey, analysis & interpretation of results. Human Resource Management IP has to interact with the non-mgt. staff a lot, on daily basis.

They have to motivate them for the improvement activities, on-plant problem discussions and have to train them for using different performance & plant related tools. For this purpose, I have witnessed a role of this course in motivating these employees and listen to their issues in order to keep them satisfied & open with IP team. Even I have to be involved in their issues sometimes, in order to retain them for my survey. Its other role is in the evaluation of IP Executives by the IP Manager. Here instead of HR dept. Manager of each dept. does the evaluation of his sub-ordinates.

Introduction to Computer Basics The role of this course is very important in IP department. These people are master in operating different computer tools like Ms-office. They have designed most of their tools & database software themselves only by using MS-Excel. This course contributes a lot towards analysis, calculations, error handlings, settings, graphics & data sharing in this department. Managerial Policy As I have not studied this course in detail yet, but its Ideas Lens plays an important role in IP department as they monitor performance & improvements in the light of ideas by the employees.

These ideas can either be given on the basis of experience or analysis. IP helps the Top Management with the vision building & strategy making regarding production processes, which are the core aspects of Managerial Policy. Marketing Management This course application can be seen during my internship project, where I created awareness & promotion strategies. This concept is new to the IP department, but at the end of my internship, I could see a clear difference in their way of conveying new things to the other departments.

But as far as they have to interact with the market forecasts from the marketing people, the department understands its worth & importance. Operations Management Operations management is a course with the major applications in IP. Resource building, production forecasting, capacity utilisation, lean system, production versions, project management and operational tools like simulation, SAP, etc are the concepts widely used in this department. Where the concepts of material resource planning, bill of materials, economic order quantities, etc are applied in logistics & application group.

PESTEL Analysis: Political: * Due to political instability foreign investors don’t want to invest in Pakistan and because of high risk in local country, domestic investors are also shifting to foreign industries. This led to the decline in investment and decrease in investment led to reduce the growth of industry. * Industrial rules & regulations change frequently with an unstable Government, which have an effect on the industry’s overall strategies & planning. In the recent political scenario, it has become so difficult for Nestle to anticipate the future scenario of FMCG industry. Economical : * Increase in demand of dollar devalue the Pakistani currency so when companies and other organizations import and purchase machinery and other items than the cost of production increases. * When Cost of goods sold(CGS) of an organization increases then to maintain their profit margins the organizations increase the prices of their products which ultimately can be a factor to reduce the demand. Due to increase in unemployment in Pakistan the purchasing power of customers is reducing day by day and people don’t have resources which is the major cause of decline in luxury products. * Due to increase in Oil prices the cost of production is increasing . * Increasing need of financing increase the real as well as the nominal interest rates. * Pakistani Government has increased the GST (General Sales Tax) by 1%. It means that now if Nestle continues its sales with the previous prices, the profits will be decreased due to increase in GST.

To avoid the impact of GST, Nestle has to higher the prices of its commodities, but this will be beyond the purchasing power of the customers. Different substitutes are available at lower prices and are affordable by consumers thats why they are buying products other than Nestle * Different substitutes are available at lower prices and are affordable by consumers thats why they opt to purchase products other than Nestle * Many of the Nestle products are being imported from its different SBUs all over the world. Raw material & machinery are also major imports of Nestle.

But this year the imports have been evaluated at 20%. It means that all of its products will face an increase in price by at least 20%. Social: * Nestle being a Corporate Social Responsible (CSR) organisation, always put its efforts for the welfare of society at large. During the past few years, Nestle Kabirwala has been indulging in the educational improvements like: * Boys School Up gradation – Adhiwala, Chak 15/20 – in May 2008. * Boys School Up gradation – Chack 14 / L- in July 2006. * Girls School Up gradation – Allah Abad – in March 2007. In 2005 eighty three (83) computers were distributed in different organizations and schools. * In 2009 Water purification plant was established in Kabirwala. * As being a CSR organization, Nestle has always thought to satisfy its customers. In this regard, it openly welcomes all types of complaints & trying to reduce them. * Nestle play a vital role for the rehabilitation of food effected areas. They distributed different products and food items and send . 25 Billion products over there to share the burdon of those needy people. Overall Nestle contributed about 6 crore for flood effected areas.

Technological: * Nestle is a market leader in Technological industry. Nestle Kabirwala Factory is the largest production block in Nestle world, in terms of capacity, area & production units. * Nestle Kabirwala has a sufficient Power Generation Unit to cope with current energy crises. This helps to attain a non-stop working of production units. * It has a fully automated Liquid Dairy Processing Plant with the totally integrated processes of milk handling * Nestle’s largest Milk Reception & Standardization Unit equipped with advanced technology is known to be as state of an art technology.

It plays an important role in delivering milk, via integrated lines, to the production units of Milkpak, Nido & Everyday. * Dry Products Unit involves the production unit of Maggi Noodles & the production unit of Milk Powders. Powders unit is equipped with the world’s advanced technology. * To maintain a shared and integrated data at very stageof product Nestle uses Globe (SAP) which is a leap for Nestle in the world of Information Technology. Environmental: * Nestle follows all the environmental laws and it’s a manufacturing plant and it doesn’t remove any chemicals which are harmful for the environment. Before starting any project an approval is taken and then a public hearing is done. A booklet is placed in the library and anyone can take part in the hearing and show their concerns. In this way they are making aware everybody in the society about their activities. * A water treatment plant of about 1 Core is placed in the factory so that the water gets treated safely and doesn’t harm environment. * The problem of air pollution is not present in Nestle KBF. Legal: * Nestle is fulfilling all the legal requirements and it is following two laws: * Factories Act Industrial Relation Laws (Standing Order Ordinance and Industrial Relations Act 2010) SWOT Analysis 1. Strengths * Nestle Kabirwala Factory has a positive impact on perception of people because Nestle is a world reputed & recognized organization. * Nestle Kabirwala Factory has state of the art technology updated according to the required standards of quality. * Asset Maintenance & Management (AMM) has been successfully implemented. * Employees have spirit of team work & accepting challenges. * SAP (System Application for Product) is fully implemented.

For Nestle, SAP has been specially modified & updated by the company according to the Nestle’s requirement & is named as “Globe 1. 5”. * Nestrade, an integrated order & purchase section of Nestle worldwide, where the order requirements have been taken from SAP by all the factories, and then the purchase has been done for all the factories on equal lowest rates possible. That is the reason why Nestle is known to have low cost operators. * As Nestle has different SBU (Strategic Business Units), therefore it can compensate losses in one SBU, if any, by profits in the other SBU. Nestle has its own distribution network which makes it easy to provide Nestle products at all possible places on time. 2. Weaknesses * Most of the Kabirwala factory resources are under utilised. * Nestle Kabirwala has to bear a heavy cost on WWTP (Waste Water Treatment Plant) as there is a temporary unavailability of canal for the discharge of effluents. * In the area where factory is located, it is difficult to find skilled staff & to retain them. * Milk is the major raw material used here.

But during lean season, the production is affected due to un-availability of milk. * For milk as a basic raw material, factory has to rely on outside milkmen, as there is no setup for its own dairy farms in Pakistan. * Because of “Environmental Compliance”, Nestle, as a whole, has to bear an extra cost to adopt environmental friendly processes of production. 3. Opportunities * Kabirwala Factory has got the further potential to absorb high volumes of production. * Continuous Improvement mindset can be more strengthen in KBF. * Further expansion in its plant lines is possible. It can sell energy in future by “Energy Co-generation” with WAPDA. * By having backward integration, factory’s own dairy farms can be established for better quality of raw material. 4. Threats * Food manufacturing ethics / Raw material adulteration are the major upcoming concerns. * Political & Economic instability of the country can manipulate the production, taxes, interest rates, etc, which will all contribute to the higher cost of production & prices. * Earlier the only competitor Nestle had, in Dairy Products, was Chaudary Dairies (CDL).

But it was never a threat to Nestle because they lack far behind in technology. But now Engro Foods is coming up with the quick changes in dairy production. This might threat Nestle Dairy Products as a reduction in market share. Recommendations: * Employees who were not permanent and working on contract in the organization were lacking the facilities like computers and other resources and thus they need to wait for a longer time to fulfil their task. So, the efficiency of those people get reduced and indirectly the performance of the organization is affected.

Organization must provide those people with the basic resources which are required for the job. * Most of the activities or tasks are performed manually and it takes a lot of time. There must be computerized system so that the output would be achieved in the minimum possible time and is free of errors. * Although Nestle is having an open culture, yet there is a communication gap among the top management and lower level employees. This gap must be reduced so that the lower level employees can easily express and share ideas. All the people mostly knew how to apply for different positions and posts through internal recruitment but at the same time they don’t have access to such opportunities. Some of them are even completely unaware when new positions are offered. * Temporary employees and employees on contract are not given that much recognition and facilities like permanent employees and thus the motivation level of those people is very low. * Most of the staff of Nestle KBF especially the non-management staff believes that the hiring process is not fair and thus it should be transparent and on merit to get the confidence of their employees.


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