PROJECT REPORT ON

A STUDY OF OPERATIONAL STRATEGIES OF “NESTLE MAGGI”

SUBMITTED TO SUBMITTED BY
MS AMBIKA BHATIA VARTIKA NAGAR
FACULTY-OPERATIONS MANAGEMENT
 Student Declaration

I, hereby declare that this Project Report titled on Operations Strategies of “Nestle Maggi”

Submitted by me to JAGANNATH INSTITUTE of MANAGEMENT STUDIES, New Delhi

is a bonafide work undertaken by me and has not been submitted to any other
University or Institution for the award of any degree diploma / certificate or published
any time before.

(Signature of the student)

NAME: VARTIKA NAGAR

 Acknowledgement
Survey is an excellent tool for learning and exploration. No classroom routine can
substitute which is possible while working in real situations. Application of theoretical
knowledge to practical situations is the bonanzas of this survey.

Without a proper combination of inspection and perspiration, it‘s not easy to achieve anything. There
is always a sense of gratitude, which we express to others for the help and the needy
services they render during the different phases of our lives. I too would like to do it as I
really wish to express my gratitude toward all those who have been helpful to me
directly or indirectly during the development of this project.

I would like to thank my Project Mentor always there to help and guide me when I
needed help. Their perceptive criticism kept me working to make this project more full
proof. I am thankful to them for their encouraging and valuable support. Working
under them was an extremely knowledgeable and enriching experience for me. I am
very thankful to her for all the value addition and enhancement done to me. No words
can adequately express my overriding debt of gratitude to my parents whose support
helps me in all the way. Above all I shall thank my friends who constantly encouraged
and blessed me so as to enable me to do this work successfully.
 EXECUTIVE SUMMARY

The project aims at understanding the Marketing strategies of Nestle Maggi. Research has
demonstrated conclusively that it is far more costly to win a new customer than it is to maintain an
existing one. And there is no better way to retain a customer than to exceed his expectations. For
this purpose it is essential to know the level of customer satisfaction.

The focus of my research was the measurement of customer satisfaction provided by Nestle
Maggi. There can be no better opportunity to interact with the external as well as the internal
customers of an organization. Finally the results of the research verify the fact that keeping the
customer satisfied is the best strategy to not only retains the existing customers but also to
expand the business to new horizons Fast-moving consumer goods (FMCG) or consumer
packaged goods (CPG) are products that are sold quickly and at relatively low cost. Examples
include non-durable goods such as soft drinks, toiletries, and grocery items. Though the absolute
profit made on FMCG products is relatively small, they generally sell in large quantities, so the
cumulative profit on such products can be substantial.
The term FMCG refers to those retail goods that are generally replaced or fully used up
over a short period of days, weeks, or months, and within one year. This contrasts with
durable goods or major appliances such as kitchen appliances, which are generally
replaced over a period of several years.

FMCG have a short shelf life, either as a result of high consumer demand or because
the product deteriorates rapidly. Some FMCGs such as meat, fruits and vegetables,
dairy products and baked goods are highly perishable. Other goods such as alcohol,
toiletries, pre-packaged foods, soft drinks and cleaning products have high
turnover rates.
 About Nestle
Nestlé is the world’s largest food and beverage company. We have more than 2000 brands
ranging from global icons to local favrouite , and we are present in 191 countries around the
world

Nestlé's purpose is enhancing quality of life and contributing to a healthier future. We want to
help shape a better and healthier world. We also want to inspire people to live healthier lives.
This is how we contribute to society while ensuring the long-term success of our company.

Our history begins in 1866, with the foundation of the Anglo-Swiss Condensed Milk Company.
Henri Nestlé develops a breakthrough infant food in 1867, and in 1905 the company he founded
merges with Anglo-Swiss, to form what is now known as the Nestlé Group. During this period
cities grow and railways and steamships bring down commodity costs, spurring international
trade in consumer goods.

NESTLÉ India is a subsidiary of NESTLÉ S.A. of Switzerland. With eight factories and a large
number of co-packers, Nestlé India is a vibrant Company that provides consumers in India with
products of global standards and is committed to long-term sustainable growth and shareholder
satisfaction.

The Company insists on honesty, integrity and fairness in all aspects of its business and expects
the same in its relationships. This has earned it the trust and respect of every strata of society that
it comes in contact with and is acknowledged amongst India's 'Most Respected Companies' and
amongst the 'Top Wealth Creators of India'.
The company dates to 1866, when two separate Swiss enterprises were founded that
would later form the core of Nestlé. In August of that year, Charles A. Page and George
Page, brothers from the United States, established the Anglo-Swiss Condensed Milk
Company in Cham, Switzerland. In September, in nearby Vevey, Henri Nestlé developed
a milk-based baby food and soon began marketing it. In the succeeding decades both
enterprises aggressively expanded their businesses throughout Europe and the United
States. (Henri Nestlé retired in 1875, but the company, under new ownership, retained
his name as Farine Lactée Henri Nestlé.) In 1877 Anglo-Swiss added milk-based baby
foods to its products, and in the following year the Nestlé company added condensed
milk, so that the firms became direct and fierce rivals.

Presence across India

After more than a century-old association with the country, today, NESTLÉ India has presence
across India with 8 manufacturing facilities and 4 branch offices.

Our global history

We want to shape a better and healthier world. This was how we started more than 150 years ago
when Henri Nestlé created an infant cereal that saved the life of a child. Learn more about Nestle
rich and dynamic history from its creation in 1866 to the present day.
Our purpose

Nestlé's purpose is enhancing quality of life and contributing to a healthier future. We want to
help shape a better and healthier world. We also want to inspire people to live healthier lives.
This is how we contribute to society while ensuring the long-term success of our company.

Products
 Bottled water
 Coffee
 Health Nutrition
 Dairy Products
 Food
 Baby Food
 HISTORY OF MAGGI

The MAGGI brand originated in Switzerland. It was founded in 1884, when Swiss entrepreneur

Julius Maggi had a vision: to make good-tasting and nutritious food accessible to busy, working
families. He invented a powdered pea and bean soup, to provide nutritious, easy to prepare food
for busy women who worked in factories and didn't have time to prepare healthy meals.

This first MAGGI product was followed two years later with the invention of ready-to-use soups
and liquid seasoning. Nestlé acquired the MAGGI brand in 1947 and today, more than 120 years
later, we strive to build on Julius Maggi's ambition of making delicious, quality and nutritious
food accessible to all.

Today the tradition continues around the world. Whether it’s MAGGI bouillons, soups, or
seasonings, consumers have come to know and trust the MAGGI brand for its high quality,
convenience and nutrition.

For over 100 years MAGGI has been a helper to home cooks around the world. Our products are
made to simplify dinner time while still inspiring exploration in the kitchen. MAGGI isn’t a
shortcut, it’s a detour to authentic flavors you may not have tried and recipes you thought were
too hard to make. So go and try something new or mix up an old favorite and let life be full of
flavor.

Marketplace

MAGGI Marketplace was created with the same vision Julius Maggi had in 1884– to
revolutionize the kitchen. Today, food lovers desire fresh ingredients prepared
authentically with simple flavors from around the world. That’s why MAGGI Marketplace
products are – global flavors made with local market inspired ingredients. Cooking with
MAGGI Marketplace not only provides a robust burst of delicious flavor, but also a
refreshing solution that simplifies meal time for novice and experienced home cooks
alike.

Maggi — The name which showed the power of branding.

MAGGI as a brand believes that happiness can be delivered through good tasting, balanced,
home-cooked food, thus its slogan “Happiness is Homemade”. Through
various MAGGI products and recipe ideas, MAGGI aims to lend a helping hand to busy
individuals, particularly working mothers who have limited time to prepare a tasty and balanced
meals or snacks for their families.

Today in Malaysia, MAGGI sells a wide range of meal solutions and cooking aids including
noodles, bouillons, seasonings and sauces. With the help of MAGGI in the kitchen, it is always
easy to create a hearty, wholesome meal that everyone can enjoy.

The real credit goes to Maggi’s campaign team for pushing all the right buttons and
ensuring its presence in every household. Their strategy when it comes to television
advertisements or even stills is so apt that when we see it, we can not only feel the
hot masala-filled noodles detangling in our mouths, but we can smell it too.
About Maggi

Brand MAGGI has started “Simply Good” initiative, in line with Nestlé’s global commitment
which is firmly embedded in our Purpose and Values which is to enhance quality of life and
contribute to a healthier future.

In India the Simply Good journey has started with everyone’s favourite MAGGI 2-Minute
Masala Noodles fortified with iron which will now provide consumers 15% of their daily Iron
requirement.

MAGGI Noodles is a part of about 70% urban Indian households and with more than 2.5 Bio
serves that are consumed by people every year (2x Indian population) it can be an ideal carrier
for iron fortification and thus contribute to closing the gap of Iron deficiency.

With this objective we have added Goodness of Iron in every pack of MAGGI 2-Minute
Masala Noodles. We have also set up a helpline number for our consumers where they can
receive all necessary information about significance of iron and iron rich foods which they
should incorporate in their diet.
Some history:

The Maggi brand originates from Switzerland where in 1886 Julius Maggi created a recipe of
flavours to bring added taste to meals. This marked the beginning of the Maggi brand and its
convenient products. Known for his nutrition-oriented approach, the Swiss Government asked
Julius Maggi to create a product that would be quick to prepare yet nutritious as more and more
women were working outside the home. The results were a success — two instant pea soups and
an instant bean soup.
 Ingredients

Noodles: Wheat flour, palm oil, wheat gluten, calcium carbonate, guar gum Taste maker
spice packet: Hydrolyzed peanut protein, Noodle powder (wheat flour, palm oil, wheat

gluten, calcium carbonate, guar gum), Spice (Chilli powder), Sugar, Onion Powder, Tapioca
starch, palm oil, garlic powder, salt, citric acid, potassium chloride, disodium guanylate,

disodium inosinate, caramel color and sodium bicarbonate. May contain traces of soy, milk
and mustard seeds.

Packaging
 Various types of Maggi
 MAGGI 2-Minute Noodles.
 MAGGI Special Masala Noodles.
 MAGGI Vegetable Spinach Atta Noodles.
 MAGGI Desi Cheesy.
 MAGGI Chatpata Tomato.
 MAGGI Chicken Noodles.
 Why I choose Maggi as for operations strategies?
As we all know about the nestle products how much they are famous throughout the
world. People buy lots of things related to Nestle like baby foods, coffee, chocolates,
health products but it’s a fact that in all of these things Maggi is so famous in every
generation whether its a child, youngster, or older age persons. In June 2015 Maggi
gets banned but after 5 months Maggi returned a makes a good sale.

I also like the tagline—later it was “2 minutes Noodles” but now the tagline has been
changed to—“2 minutes for education” to prove Girls with access to education not only
improve their own lives but also bring positive changes to their families, communities
and economies.

The tagline plays an important role in each and every product from which we can
easily identify the products name.

 2 Minutes Noodles — Convenience.

 Taste bhi Health Bhi — Health.

 2 minute mein Khushiyan (Happyness in 2 minutes) — Fun & Happiness.

It was devised as a two pronged strategy to attract mothers on the ‘health & convenience’
plank and lure kids on the ‘fun’ plank. Their--

 Colour selection — red & yellow — bright, attractive — scientifically known to

induce hunger in human beings.

 Logo consistency — literally remained unchanged since its origin — with such a
consistent logo & colour elements, every age group will be able to relate with the
brand over a period of time, evoking nostalgia.
 Target Market of Maggi
Segmentation

Segmentation allows dividing heterogeneous market into groups of homogeneous

customers which share same needs and demands. Maggi segmented the market on the
basis of lifestyle and eating habits of consumers. Segmentation can be divided on the
basis of different information.

DEMOGRAPHIC
Old customer will plan and economize time and money leading to more time spent.
Females who combine outside work with household work are likely to experience
greater time constraints (Zeithaml 64). Age and gender aspect of demographics was taken into
account by Maggi by focusing on young working people who didn’t had much time to prepare a
meal and that is how Maggi two minute noodle was a success.

GEOGRAPHIC
South and east parts of India where majority of the population consume rice. Maggi
segmented the market accordingly and launched its rice noodles to attract and fulfill the
needs of the customers. Variants like curry, masala, tomato, shahi pulao and chicken
were introduced to attract customers from different regions.

PSYCHOLOGICAL AND BEHAVIORS

A customer may report eating health but the grocery scanner data can be compiled to
show the behavior of the customer. Since the customers from the urban and the rural
region differ in their eating habit and their grocery expenses which is why it is available
in 5INR small pack also to attract the rural customers along with the urban customers
and to have a positive consumer behavior it launched Maggi Atta whole wheat flavor to
make it more nutritious.
TARGETING

The targeted segment by Maggi is kids, youth, office goers and working individuals.
From the beginning the main focus of the company was to develop food products for
people with busy lifestyle which aligned with the targeted segment answering the
second perspective of targeting.

NESTLE gained its 34% of the total revenue from its noodle and soup. Maggi noodles
are the most wanted noodles in India answering the first perspective of targeting.

Positioning

The purpose of POSITIONING is to create a clear and unique image of the brand and
its offering in the eyes of customer. This competitive edge and the company’s distinct
focus and then lead to its differentiation from other brands.

Conducting qualitative testing and making use of the perceptions of consumers related
to the brand are a part of positive positioning.

1-Product Differentiation
Maggi claims that its item is healthy and can be made in 2 minutes. This is the claim
which only Maggi make and this has led to their “differentiation” from other brands in the
view of the general population.
 3. Product Image
Maggi is a word which reverberates with the word noodle. In India, Maggi word is
utilized all around rather the word noodle. That is the reason other brands have a hard
time in building up their item.

4. Service Differentiation
For maintaining its picture in the business sector, Maggi always contributes time and
cash to think about the need, prerequisites and the desires of its customers. It is
therefore on the top among its rivals like Sunfeast, Horlicks, Top Ramen and so on.
 Budgeted allocated for Maggi
Data sourced from its annual report for the year 2019 show it sold around 264,000
tonnes of Maggi products during the year, compared to 254,500 tonnes in 2014. In
value terms, the firm had already surpassed the pre-ban level in 2018 at Rs 3,105 crore,
compared to Rs 2,961 crore in 2014. In 2019, it sold Maggi products worth Rs 3,500
crore. The company follows a calendar year format for financial reporting.

The Maggi fiasco in 2015, when it was banned by the food regulator, had taken a toll on
all its four broad business categories. While, it managed to recover sales (by volume
and value) in the other three categories, Maggi sales had lagged.

The crisis had also impacted its total volume uptake in the intervening years. This was
addressed by the recovery in sales of Maggi, which contributes the largest chunk to the
firm’s volume uptake and is the second largest segment in terms of revenue, as total
offtake in 2019 stood at 478,400 tonnes — higher than the 458,600 tonnes in 2013.

According to Edelweiss Securities analysis, in 2019, Nestle steadily “continued its

nutrition, health and wellness journey through strong volume and mix-led growth. The
company stayed in its path of growth, by investing in cutting-edge science and
innovation and taking decisive steps towards renovation”.

The 71 new products that Nestlé introduced under brands like KitKat, Maggi, EveryDay,
Cerelac, among others, contributed 3.4 per cent of its sales in 2019, it observed. “By
driving greater agility and rapidly adapting to the changing preferences of consumers,
Nestlé brought meaningful differentiation, by improving taste, convenience and
nutritional qualities of its products, which saw an increase in consumer trust,” said
Abneesh Roy, executive vice-president, institutional equities, Edelweiss Securities.
 Production system of the product
Maggi noodles are one of the famous noodles brands in the world. They are prepared in
the same way as people prepare bread. The ingredients required in the production of
these noodles include monosodium glutamate, palm oil, flour, sugar, salt, and
seasoning. However, it is manufactured in the factory on a large scale. Due to this
reason, a Noodle Making Machine is needed. If you want to know that “How is Maggi
manufactured in the factory” then no problem! We have mentioned below the steps in
which noodle making machine prepares these noodles.
1.    Feeder System

The machine has a feeder system. It utilizes a vacuum distributor through which the
flour is moved to the mixer.

2.    Mixing

There is a motor drive gear present in this machine. It moves the campaigner tube to
prepare the dough. Water is mixed properly with the flour with the help of the mixer.
When the dough is ready than the motor moves the roller to drive the belt. After that, the
dough is shifted to the belt. Next, the mixer spreads the dough evenly into the
compounding part of the machine.

3.    Compound Process

With the help of the dough distributor, the dough is transferred to the compounding part
of the bowl noodles packing machine. First of all, it presses the dough properly. After
that, it separates the dough into two pieces. The compounding process is imperative to
enhance the flavor and taste of the noodles.

4.    Slitting

When the compounding process ends then the dough is moved to the slitter of
the noodles cutting machine. There is a rotating cutter in the slitter which cuts down
the dough sheet properly.
5.    Steaming

There is a multilayer steam box embedded in the machine. It is quite useful as in the
box; the noodles are steamed for one to five minutes at 100-degree centigrade. With the
help of steam, the starch present in the noodles becomes digestible.
6.    Cutting

After the process of steaming, the noodles are cut into the required shape and length.
The compressed air is blown on the noodles to shape them up appropriately.

7.    Frying Process

The perfectly shaped noodles are dewatered at the temperature of 140-degree

centigrade. For that reason, the moisture content is condensed to 4-6 percent. Also, the
starch is more gelatinized.

8.    Cooling & Packaging Process

In the end, the Noodle Making Machine blows cool air on the noodles. Afterward, they
are properly sealed efficiently. The conveyor belt of the machine then sends these
sealed noodles to the packaging area. In this area, the noodles are packed up in the
packets.
 Plant Layout
1. Plant layout Nestlé India set up its first manufacturing facility at Moga (Punjab) in
1961 followed by its manufacturing facilities at Choladi (Tamil Nadu), in 1967;
Nanjangud (Karnataka), in 1989; Samalkha (Haryana), in 1993; Ponda and
Bicholim (Goa), in 1995 and 1997, respectively; and Pantnagar (Uttarakhand), in
2006. * First research and development centre in India at Manesar in
Gurgaun( 290 crore investment) In 2012, Nestle India set up its 8th
manufacturing facility at Tahliwal (Himachal Pradesh).
2. 14. R&D centres  Nestle institute of health sciences, Switzerland
http://www.nestleinstitutehealthsciences.com  Nestle research centre
http://www.research.nestle.com/  1.7% of sales in R&D activities  Recall of
maggi from the market in Philippines , Salmonella

3. Maggi is currently manufactured at three plants in India with lines dedicated to the
instant noodle brand

4. The new plant will come up in Gujarat

5. The local arm of Swiss consumer goods company Nestle will invest ₹700 crore initially
over the next two years to set up a new plant for Maggi noodles, nearly four years after
the brand was hit by its worst food crisis in the country.
6. The construction of the plant will commence soon in Gujarat, the company informed
stock exchanges on Friday. This will be Nestle’s ninth factory in India.
NESTLÉ India set up its first manufacturing facility at Moga (Punjab) in 1961 followed by its
manufacturing facilities at Choladi (Tamil Nadu), in 1967; Nanjangud (Karnataka), in 1989;
Samalkha (Haryana), in 1992; Ponda and Bicholim (Goa), in 1995 and 1997, respectively; and
Pantnagar (Uttarakhand), in 2006. In 2012, Nestlé India set up its 8th manufacturing facility at
Tahliwal (Himachal Pradesh).

The 4 Branch Offices located at Delhi, Mumbai, Chennai and Kolkata help facilitate the sales
and marketing activities. The NESTLÉ India’s Head Office is located in Gurgaon, Haryana.
Layout design
 Production process and strategies implemented:

 Maggi Product Strategy:

The instant noodles category has a wide variety and very popular globally. The major
Maggi products in this category are 2-minute Noodles, Chicken noodles, Vegetable
Multigrainz noodles, Cuppa Mania, Hot Heads noodles, Oats noodles, Atta noodles.
This is the backbone of the product strategy in the marketing mix of Maggi. 

Maggi is leading food brand under the umbrella of Nestle. Maggi has a wide variety of
products and has a different range for each country. 

 Maggi Price/Pricing Strategy:

The competitive prices are compensated with high volumes of the products. This shows
that competition and cost are the two major factors in the marketing mix pricing strategy
of Maggi. Because of rising prices in various countries Maggi has smartly started
reducing the quantity to keep the prices unchanged. Nestle strives to capture maximum
market share with low prices and high quality standards. As Maggi is trying to tap into all
segments of income category it keeps differential prices in depending locations and
across countries. Also its offerings are available in wide variety of packages so that
people can buy according to their needs. In recent times Maggi has started coming up
with new products like the cup range and Hot Heads noodles which it targets for the
higher income level segments and hence are priced at higher range.
  Place & Distribution Strategy:
Following is the distribution strategy of Maggi:

Maggi products are widely available due to the strong presence of Nestle. The
distribution strategy followed by Nestlé is Producers to Distributors to Wholesalers to
Retailers to Consumers. This is because it is consumed in a lot of volumes and
generally in small quantities. Due to its so deep reach even into rural areas and small
towns, it has gained it the top position. Maggi products are directly taken from the
factories which are independently managed to Carry and Forward Agencies who then
store in there large warehouses and pass them onto the wholesalers according to their
demanded quantities. These quantities are then distributed among the retailers or to the
end customer through hypermarkets, other small businesses and even its own kiosks to
corporates. The retailers can be convenience stores or local supermarkets

 Maggi Promotion & Advertising Strategy:

The promotional and advertising strategy in the Maggi marketing strategy is as follows:

Maggi has used advertising as its main promotional strategy to create awareness and
for brand recall. Initially it focused on kids and working women who have very less time
to prepare food. The advertisements mainly flashed on kids channels with effective tag
lines of “Bas 2-minute” and the jingle “Maggi Maggi Maggi”. On its 25th anniversary it
launched the voice over campaign to create a nostalgic feeling among the customers
about their journey with Maggi. It has also used the “Miss you Maggi” ad campaign to
regain back the lost customers after the Maggi ban in India. As sales promotional
strategies over the years it has attached various free goodies with its products such as
free samples, fun books and toys. Maggi has also offered discounts, Scratch n Win
schemes. It also used many celebrities notably Amitabh Bachchan and Madhuri Dixit for
brand endorsements. This completes the marketing mix of Maggi.
 INVENTORY MANAGEMENT

Each time an inventory item is received or issued from the inventory at one of the Nestle
locations, the system automatically updates stock quantities and values, and reduces
inventory. Time consuming tasks are simplified through determining optimum source of
supply, analyzing and comparing vendor pricing, issuing purchase orders, managing the
authorization for purchase requisitions, processing invoices for payment and recording
the same. The efficient supply chain at Nestle requires all stock planning and
operational activities to be integrated into a uniform business-process flow.

At the inventory management there are three types of Goods Movements namely goods
receipt, goods issue and transfer posting. As soon as the goods movement is entered
stocks are updated, material documents are created to record the event and accounting
documents are created when change in valuation area occurs.
Because of its perishable nature, the inventory management of Nestle is done on
the FIFO (First in first out) basis.

LOADING, UNLOADING, HANDLING AND

TRANSPORTATION CONDITIONS:
ACCEPTANCE LETTER:
Acceptance letter is the conformance letter that ensures that the warehouse accepts or
receives the inventory, it includes:

 Invoice Number
 Whom to Sold
 Whom to ship
 Dispatch Date
 From whom
 Product Description
 Unit Price

Product Type Noodles

Maggi 2-Minute Noodles 70g (Pack of 12)
Masala,
Brand Maggi
Packaging Size 70 GM
Machinery used in production
Quality control chart
 The importance of quality in Nestle:
 Build trust by offering products and services that match consumer expectation and
preference
 Comply with all internal and external food safety, regulatory and quality requirements
 Gain a zero-defect, no-waste attitude by everyone in our company
 Make quality a group-wide objective

The food safety is not about being competitive; it’s part of our responsibility to help protect both
consumers and food industry businesses. To that end, we hold all the products we test to the
utmost safety and quality standards.

 
Our Priority

To ensure that your consumers feel confident in the foods they eat and feed their families.

Our Vision

To be a trusted laboratory partner and #1 choice for quality assurance and analytical services.

Our Mission

We are dedicated to providing the highest quality analytical food safety testing, with industry-
leading service and results for our customers and their businesses.

 
Our Promise

We are committed to providing the highest quality results and industry-leading service with
absolute confidentiality.

Our Focus

Safety – People – Quality – Delivery – Cost

Commitment to Quality

Our commitment to quality and reliable results is embedded in our work and demonstrated daily
by our staff, so that our customers can feel confident in the results they receive from NQAC
Dublin

Commitment to The Environment

We became the first laboratory to receive the Encouraging Environmental Excellence (E3)

awards by the Ohio Environmental Protection Agency (EPA).
NQAC Dublin achieved these awards with top scores in environmental excellence categories,
including environmental management plans, employee engagement, organic diversion,
management commitment and continuous improvement
 Maintainance management
Quality by design

Quality is built in during product development according to the requirements of the consumers
and following all food safety and regulatory requirements. Nestlé’s R&D network applies in this
"Quality by design" to all of our products.
 

Good Manufacturing Practices

We apply internationally recognized Good Manufacturing Practices (GMP) to ensure quality and
food safety. GMP covers all aspects of manufacturing, including standard operating procedures,
people management and training, equipment maintenance, and handling of materials.
 

From farm to fork

Our Management System starts on farms. We have a long history of working together with
farmers in rural communities to help them improve the quality of their produce and adopt
environmentally sustainable farming practices.

 The Quality Management System not only ensures our ongoing access to high quality raw
materials. It also enables farmers to protect or even increase their income. Often the standard of
living of entire rural communities is raised as a result. The system helps address key global
environmental and social issues.

Good Manufacturing Practices

We apply internationally recognized Good Manufacturing Practices (GMP) to ensure quality and
food safety. GMP covers all aspects of manufacturing, including standard operating procedures,
people management and training, equipment maintenance, and handling of materials.
 ERP in Nestle

Nestlé SA is a giant food and pharmaceuticals company that operates

virtually all over the world. Headquartered in Vevey, Switzerland, the
company had 2004 revenues of $76 billion and more than 253,000
employees at 500 facilities in 80 countries. Best known for its chocolate,
coffee (it invented instant coffee), and milk products, Nestlé sells thousands
of other items, most of which are adapted to fit local markets and cultures.

However, Nestlé's management has found that allowing these local

differences created inefficiencies and extra costs that could prevent the
company from competing effectively in electronic commerce. The lack of
standard business processes prevented Nestlé from, for example, leveraging
its worldwide buying power to obtain lower prices for its raw materials. Even
though each factory uses the same global suppliers, each negotiated its own
deals and prices.
Several years ago, Nestlé embarked on a program to standardize and
coordinate its information systems and business processes. The company
initially installed SAP's R/3 enterprise resource planning (ERP) software to
integrate material, distribution, and accounting applications in the United
States, Europe, and Canada.

Nestlé is working on extending its enterprise systems to all of its facilities to

make its 500 facilities act as a single-minded e-business.
The experience of Nestlé USA illustrates some of the challenges Nestlé had
to face in implementing enterprise systems. Nestlé USA, an $8.1 billion
subsidiary, in 2001 used to be organized as a series of brands, each
operating independently. So, for example, the Stouffer's and Carnation units
were separate companies, each owned by Nestlé SA, the Swiss-based
parent, but reporting to Nestlé USA. In 1991, Nestlé USA reorganized itself
and the different brands were brought under the parent American control.
However, the Nestlé division headquarters were still dispersed, and each
division was still free to make its own business decisions, although each one
within the United States did report to Nestlé headquarters in Glendale,
California. The situation did not really begin to change until the spring of
1997 with the arrival of Jeri Dunn as vice president and CIO of the American
company.
Dunn actually knew Nestlé technology unusually well because of her long
history with the company. In 1991, as associate director for application
systems at Nestlé-owned Stouffer's Hotels, she was sent to Switzerland to
participate in an effort to establish a common worldwide methodology for
Nestlé projects. In 1995, she was promoted to assistant vice president of
technology and standards for Nestlé SA, and while there came to understand
and agree with the value of establishing common systems throughout global
Nestlé because such a change would enable group buying which in turn
would reduce costs. Dunn also realized that common systems would
facilitate data sharing among subsidiaries. When she was moved to Nestlé
USA in 1997 at age 42, she found that her earlier recommendations from
Vevey were mostly ignored. "My team could name the standards," Dunn
said, "but the implementation rollout was at the whim of the businesses.

.
Supply Chain Management
Key Learning’s as an Operations Manager by the student during this
project.
Lesson 1: Involve Yourself in the Processes

By placing themselves on the front lines and observing personnel at work, these managers can
ensure that staff is on track to meet company objectives. Watching how the workflow operates
first-hand provides managers with a very vivid picture of how a department is performing.
Further, it’s the best way to correct mistakes, offer guidance on how tasks can be better
completed, gauge efficiency and analyze any problems that may occur. 

Lesson 2: Cultivate Talent in Your Team

Brilliant procurement operations managers realize that everyone on your team is

responsible for maximizing your company’s overall performance, regardless of how
menial some of those tasks may be. In order to encourage your team members to buy
in, you need to ensure your employees feel valued. Consider how you can nurture the
abilities of teammates before trying to lure and groom someone new. Skilled managers
are adept at recognizing outstanding talent within their own walls, so keep this in mind
when you’re trying to foster company culture and improve the stability of your team.

Lesson 3: Make Small Changes First

Consider the negative effects of large-scale changes before overhauling procedures

and make smaller alterations first to test your proof of concept. Examine the current
workflow and deftly tweak the process—this could mean giving one colleague an
additional responsibility or shortening the timeline of a project. Managers need to then
assess the costs and benefits of those changes, factor in delays, disruptions and effects
on internal operations. Incremental changes that improve performance without
sacrificing quality and staff morale, will indicate how adaptable a company may be to
larger changes down the road.
Lesson 4: Never Stop Learning

Leadership authority Ken Blanchard stresses that “When you stop learning, you stop
leading.” Even if operations managers are already experts in their field, they should
always look for new ways to improve their performance. In particular, managers should
always be exploring how new technologies can speed up company workflow and
increase efficiency. For example, by using software from procurify , managers can
automate their purchasing workflow, leaving them with more time to focus on managing
their team and identifying new opportunities.

Lesson 5: Take Calculated Risks

Calculate the probability of failure and weigh that against opportunities for success. This
will help to mitigate any fears of failure and keep any reckless ventures in check.
Regardless of the outcome, the results can serve as valuable learning experiences that
can benefit the well-being of an organization in the long run.

Good employees recognize that they can learn important lessons from other members
of their team, regardless of what department they’re in. With their wealth of knowledge
and focus on streamlining your processes, operations managers are fantastic teachers.
Apply what you’ve learned from any of these lessons in your day-to-day operations and
see how small changes can make a big difference to your bottom line and company
morale.