Question 1

Nestlé is The 'laboratory' where the CSV concept is found, then formulated. Foundation
Strategy Group (FSG) is the consultant used Nestlé to review how Nestlé carries out a business
strategy as well as the CSR. The Nestlé value chain, in simple terms can be summarized into
three components major: Agriculture and sourcing; Manufacturing and distribution, as well
Product and consumers. In consistent Nestlé always thinks about how can that component
contributes to the embodiment of CSV, ie through the impact of the business chain (value chain
impacts), growth context (context for growth), benefits for Nestlé (value for Nestlé) and benefits
for society (value for society)(nestle, 2018).
stakeholder convenings, workshops and other events provide opportunities to deepen that
dialogue, building on our understanding of important societal issues. The interaction helps our
teams to develop the capability of our people, facilitates collective action and promotes trust and
mutual respect. Outcomes from such dialogue are fed back to senior management through the
Nestlé in Society Board. The stakeholder perspective promotes ethical business decision-making
and focuses on long-run sustainability by emphasizing a stable customer base, employee well-
being, a better corporate image, and corporate social responsibility. Ethical decision-making
includes a fair and equitable distribution of corporate profits, empowering business decisions and
stabilizing employment. In a new and contemporary economy, the stakeholder perspective
provides a better view of managing corporations by promoting long run focused, ethical
decision-making and by paying attention to “common good”. This will ultimately help in
improving profitability and long-run sustainability. s. Building on many Nestlé-sponsored
education programmes, we are implementing our Healthy Kids Global Programme by
developing partnerships in all countries where we have operations by the end of 2011. To
provide consumers at or near the base of the income pyramid with greater access to affordable
food products, we offer 4860 Popularly Positioned Products (PPPs) [KPI] at an affordable cost
and appropriate serving size through a range of locally adapted distribution methods. Many PPPs
are also fortified with key micronutrients to address deficiencies in certain markets.(Nestle
Global, 2019).
In our operations, we strive to continuously improve our operational efficiency and
environmental performance, and apply a life cycle approach to assess our own operations and
those associated with the wider value chain, to produce tasty, nutritious food and beverages with
the lightest environmental footprint. We aim to provide all Nestlé employees with a professional,
healthy and inspiring working environment that fosters personal accomplishment and team
development, and that respects diversity and equality(Nestle Global, 2019).
The Guarantor is the ultimate holding company of the Nestlé Group (including NHI and
NFI). Accordingly, substantially all of the assets of the Guarantor are comprised of its
shareholdings in its subsidiaries. The Guarantor is therefore dependent on the performance of its
direct and indirect subsidiaries which manufacture and sell food and beverages, as well as
products related to the nutrition, health and wellness industries. The Guarantor is also dependent
on the performance of its subsidiaries to the extent it issues guarantees with respect to them.
Payment obligations under the Guarantor’s Guarantee of the Notes will be structurally
subordinated to any payment obligations owed by the Guarantor’s subsidiaries to their creditors.
Swot Study Analysis for PT Nestle Indonesia(Nestle Global, 2019).:
• Strength:
1. Good corporate reputation
2. Good quality and product quality
3. Marketing team that ensures product quality
4. Great promotion and advertising
5. Strong research development (R&D) network
6. Decentralized control management

• Weaknesses:
1. The product price is relatively expensive
2. Promotion costs are relatively expensive
3. Market share that does not reach all levels
• Opportunities:
1. Creating a positive brand image for Nestle products
2. A popular health-based product that creates opportunities for Nestle
3. Opening a cafe or special outlet for Nestle products to reach the market
4. make promotional alliances or price collaborations with other companies
• Threats:
1. Consumers view of expensive products so that consumers switch to other products
 2. Relatively expensive raw materials
3. Competitors with similar products with not bad quality and cheaper prices

SWOT Matrix (Nestle Global, 2019).

• WO strategy
1. With a good reputation and brand image, Nestle's products are easily trusted and accepted
by the public
2. Making health-based products of good quality and quality
3. With adequate R&D facilities enabling Nestle to conduct research and development on
health-based products
4. With a good reputation and decentralized control management makes Nestle companies
open to opportunities for alliances or price collaborations with other companies
• SO strategy
1. Creating products with excellence and good quality so that relatively high prices are not a
problem for consumers
2. Promotion through cafes or outlets by offering various Nestle products and holding
various promos
3. Make products that focus on health and the quality of people's lives at affordable prices
• WT strategy
1. Increase marketing and convince consumers of product quality so that price is not a
problem
2. Creating attractive advertisements and making Nestle products in the minds of consumers
3. Making products in packaging or small scale (retail) while ensuring quality and quality so
that all consumers can enjoy it
• ST strategy
1. Making mid-priced products with the best quality among similar products
2. Create attractive advertisements to increase sales
3. Advertise or carry out promotions with a focus on the advantages of similar products that
are cheaper.
 By delegating decision-making authority to each business unit, Nestle applies a
decentralized management strategy for system control so that decisions are made according to
circumstances in each region. To gain a competitive advantage in order to organize all of its
business units around the world, it needs the role of an information management system that
can handle all business operations. A key word for Nes is the option or development of the
company's best idea over a period of time.A corporate strategy is likely to be successful if it
focuses primarily on maintaining the excellence of each business unit(Nestle Global, 2019)..
Whether the new business unit will generate competitive advantage from its
partnership with other business units or with the parent company is another factor in building a
corporate strategy. There are four business planning principles that have been widely applied:
portfolio management, transformation, expertise transfer, and activity sharing. The
management of portfolios is based on a variety of critical assumptions. Diversification, such as
acquisitions , mergers, or mergers, may be achievedThrough the restructuring strategy, Nestle
companies are looking for companies that are not too developed (undeveloped), are sick, or
who are facing difficulties due to insurmountable changes in the business environment. The
parent company Nestle intervened by changing the management team, changing business
strategies, infusing new technology, or selling / closing units that were inefficient or not
directly related to the core competencies of the related business unit. In transferring skills, there
is synergy and an active process to change the strategy or operations of the business unit. The
process of changing a business unit for the purpose of transferring skills must be specific and
identifiable. Almost similar to transferring skills, in sharing activities between business units
using several resources in the value chain together. Apart from the above strategic concepts,
Nestle uses a monolithic, dualistic or multilithic brand strategy that depends on a balance
between the financial investment invested and the strategic and financial benefits to be
achieved from this investment. Because monolithic and dualistic brand strategies use the same
brand name for various products, the brand value of successful brands is expected to be
exploited. Capitalization of brand names can generate significant financial benefits for
sustainable brand development(Nestle Global, 2019)..
1. Quality Growth
Our growth brings many benefits to our stakeholders. Our more than 75,000 Associates
work for a collaborative and forward-thinking business that nurtures diversity and
 intellectual curiosity. Our commitment to creating mutual benefits generates economic
opportunities for the communities where we operate, including the suppliers and farmers
in our value chain. Our consumers benefit from our brands, from the nutritional value of
our food products and the moments of joy derived from our chocolate to the oral care
benefits of sugar-free gum and the high quality products and services that keep pets happy
and healthy.
2. Positive Societal Impact
Deforestation is a highly complex issue that intersects with our material environmental
and social impact areas. Its causes range from cutting down trees for products, such as
timber and pulp and paper, to clearing forests for agriculture. Forests serve as important
reservoirs of carbon, and reducing primary forest cover results in increased greenhouse
gas concentrations. Deforestation also affects local rainfall patterns, biodiversity, and
people who depend on forests for their livelihoods. The challenge for Mars, and the
broader food industry, is to eliminate deforestation within our supply chains, while
tackling its underlying cause
3. Trusted Partner
The suppliers and farmers in our value chain derive benefit from our economic
relationships and our partnerships to adopt more sustainable practices that improve quality
of life, and safeguard valuable natural resources.
In order to raise the bar on food safety and security, M&M Mars Global Food Safety
Center produces cutting-edge science. Research published in 2019 would improve the detection
of foodborne pathogens and make it easier for outbreaks to respond faster. We are also working
with partners on a sophisticated fingerprinting system to verify food authenticity, a potential
game changer to keep food safe and minimize waste.The Mars Five Consistency, Obligation,
Mutuality, Productivity and Freedom Values are the cornerstone of our community and our
business approach. Generations, geographies, languages and cultures bind us. Our Five
Principles are a synonym for Mars and have driven Mars Associates over much of the history
of our business. We do our utmost every day to bring our values into practice through our work
and our partnerships with our clients, customers , business partners, and
communities(Matthewson et al., 2008). Supplier Code of Conduct ensures that we are able to
uphold the concept of Mutuality and provide consistent excellence for our consumers and
 stakeholders. Our suppliers are expected to comply with the following standards and are
encouraged to exceed the requirements set forth in this Code of Conduct.
Early on, Mars put itself as a price pioneer. Mars was able to greatly reduce its costs by
producing a variety of chocolate bars, all of which can be made on the same high-speed
manufacturing line and using products that are less costly than those of the competition. This
extra profit was used in every grocery store in the U.S. to buy the best shelf space, and Mars
became one of the major players on the market with this.This strategy involves selling the exact
same brands and products in various regions(Matthewson et al., 2008).Supplier meets all legal
requirements for the payment of overtime and incentive rates. Supplier pays overtime at a
premium rate / at a rate at least equal to the normal rate of compensation.
• Supplier provides all legally mandated benefits, including holidays and vacation
days.
• Supplier communicates, orally or in writing, to all employees: wages, incentives,
benefits, and bonuses to which all employees are entitled in that facility and under
the applicable law. Supplier records this communication.
• Supplier provides each employee with an itemized wage statement upon wage
payment. The statement includes, at a minimum, amount of pay, pay period, rate
of pay, regular and overtime hours worked, deductions and benefits, if applicable.
.

Question 2
1. What are Nike Indonesia tangible and intangible resources. ?
Garment processing that is not linked to global supply chains is a source of
employment large in many developing and fast developing countries (developing
country). Garment processing is also often referred to as a 'pioneering' industry for
export-oriented diversification. 1 Meanwhile, the integration of supply companies in the
global supply chain involves market access broad and can offer upgrading opportunities,
this too are challenging conditions and pressures. In particular, in the garment industry,
there are an increasing trend towards demand for shorter production times, orders in
small quantities, increasingly diverse products and styles, and unit prices cheaper. Apart
from this, there are several facts that this trend can give rise to negative impact on
working conditions, especially long working hours, hazardous work and small wages.
Poor working conditions would otherwise be a cause for concern partly international
buyers, they expect suppliers to comply with labor regulations and the environment, in
addition to shipping goods at a price, time schedule and other key business
considerations. Nike already has several programs to assess and its suppliers with a
purpose to address challenges in supply chain management and working conditions. This
case study focused on capacity building programs to improve lean management practices
Manufacturing among clothing suppliers(NIKE, 2019).

This analysis shows that for these companies, the application of Lean practices This
manufacturing has succeeded in reducing the level of non-compliance with labor
regulations 15%, mainly regulations related to compensation and working time. Nature
this change in compliance (which is focused on compensation and hours worked) shows
that the relationship between the application of Lean manufacturing management
practices with partial working conditions great deal can be explained by the fact that lean
manufacturing has made a difference labor and human resource practices. In particular,
Lean manufacturing requires a significant investment larger to hold training for workers
and greater wisdom of the workers, because workers in an effective system are expected
to carry out that task outside the duties required in a standard mass production system: for
example, workers are involved in efforts to solve common problems and participate in
quality control their work area. Higher levels of participation of workers and investment
in fields worker training shows that managers have an incentive to improve working
conditions in order to motivate and retain skilled workers. Another way that can also be
used to explain the relationship between Lean manufacturing and improving working
conditions is a management system: Lean manufacturing yields increased management
capacity and more effective processes, which can facilitate compliance with certain
aspects of labor regulations, such as regulations regarding Occupational Health and
Safety. Analysis of the data in this study did not see any evidence that the mechanisms in
these firms have been reviewed, however, are few Other studies have suggested that this
is an important dimension of the Lean relationship manufacturing with working
conditions(NIKE, 2019)..
2. Translate nikes tangible and intangible resource into capabilities
Nike has a variety of shoe designs, characteristic of shoe designs Nike is always
creating shoes with the latest designs and made from the best ingredients are processed
with the latest technology. This is Nike's efforts so that the products produced are able to
provide appropriate benefits the desires of the consumers. All of Nike's efforts are aimed
at making consumers capable perceive that Nike shoe products are sports shoes best
among other brand shoes. Seeing the phenomenon of the large demand for quality sports
shoes the best and the competition of producers in responding to these requests. 6 So one
of the survey institutions in Indonesia is the Top Brand Award at once is an award event
for the best brands conducting surveys with the category of sports shoes(NIKE, 2019)..
Shared value Nike's Lean manufacturing program that is focused on improving
performance companies and provide business benefits as well as provide positive social
results in terms of conditions better work. This program creates value for a wide range of
stakeholders: it benefits to suppliers, who enjoy that productivity, quality and capability
higher order to meet buyers' demands, this program also provides benefits to the buyers
workers, who see positive changes to their working conditions, and this program also
gives benefits to buyers, who benefit from a more efficient and supply chain less
reputational risk due to poor working conditions. The 'shared' value created this program
can be an important factor in facilitating self-reinforcement mechanisms through positive
changes that can be obtained by stakeholders. Supply chain relationship with the role of
lead buyers In sectors such as clothing and shoes, several large-scale lead buyers usually
have big influence, especially the first layer suppliers. The fact that this program is
offered by a buyer is an important factor influencing the participation of suppliers.
Besides that is, the fact that the implementation of Lean manufacturing practices is
verified by the buyer entered into the appraisal form will most likely be an incentive in
applying Lean practices after training. In setting targets for its Lean program, Nike
focused its attention on para supplier with whom he has had a long working relationship.
Long working relationship and sustainable sourcing is an important factor influencing
supplier commitments to programs and improvement efforts. Commitment, capacity and
continuity This program is a great program. Nike already has trained staff, set up
facilities training, and its staff has had a large participation over the years with good
 suppliers at the leadership and operational levels. Hence, these interventions benefit from
the major investment that Nike made and of its relationships and influence in the supply
chain. Lean enabling programs also require substantial commitment and investment from
the suppliers. This program requires the participation of senior managers in the training
program residential for 8 weeks, they are expected to cover training costs, and have
willingness to carry out major changes in the organization of work in the factory
each(NIKE, 2019).

3. What are nike’s core competencies ? describe the process you qualify them
The product quality of Nike sports shoes is quite good with a percentage 50.50
percent. The variable of product quality affects the purchase decision amounted to 0.237
or 23.7 percent, which means that the quality of the product affects the decision purchase,
meaning that if the quality of the product provided is getting better it will affect high
purchasing decisions. Promotions owned by Nike sports shoes are in the good category
with a percentage of 54.60 percent. Promotion variables affect purchasing decisions by
0.173 or 17.3 percent which means that promotion affects purchasing decisions, meaning
if the promotion is getting well, the frequency of advertising and sales promotions are
frequent, the clarity of the ad is easy to understand, the media which is used a variety of it
will affect the high purchasing decisions. The brand image of Nike sports shoes is in a
good category with a percentage of 53.60 percent. The brand image variable affects the
purchase decision, the result is 0.423 or 42.3 percent which means that the brand image
affects the purchase decision, meaning if the image the brand is getting famous, proud,
and has prestige value when using it it will affect the high purchasing decisions. The
decision to buy Nike sports shoes is in the high category with a percentage of 55.70
percent. Variables of product quality, promotion, and brand image resulted in more
appropriate and high purchasing decisions for Nike sports shoes. This means factors of
product quality, promotion, and brand image is the basis for consumer consideration
before deciding to buy shoes Nike sports. This can be seen from the results of the
coefficient of determination on the effect of product quality, promotion, and brand image
on purchasing decisions by 0.429 or 42.9 percent(Saputra et al., 2014).
 Reference
Matthewson, N., Mevs, A., Seeley, A., & Simpson, K. (2008). M & M ’ s Brand Case Study
Update.
nestle. (2018). Creating Shared Value.
Nestle Global. (2019). Nestle Global Annual Review 2019. 1(1), 94.
https://www.nestle.com/sites/default/files/2020-03/2019-annual-review-en.pdf
NIKE. (2019). NIKE Annual Report. Form 10-K, 167.
https://d18rn0p25nwr6d.cloudfront.net/CIK-0000320193/4913a187-8e3a-418a-a499-
b210aebd9da6.pdf
Saputra, D., Waluyo, H. D., & Listyorini, S. (2014). EFFECT OF PRODUCT QUALITY ,
PROMOTION , AND BRAND IMAGE ON PURCHASE DECISION OF NIKE SPORTS
SHOES.