MALACCA BRANCH

ALOR GAJAH CAMPUS

FACULTY OF HOTEL AND TOURISM MANAGEMENT
DIPLOMA OF TOURISM MANGEMENT

FUNDAMENTALS OF MANAGEMENT
(MGT162)
NESTLE MALAYSIA BERHAD

PREPARED BY:
NO NAME MATRIC NUMBERS
1. MOHAMMAD ARIEF ILHAM SHAH BIN ALIAS 2022808668
2. MOHAMMAD IQBAL NAIM BIN NORDIN 2022891288
3. NURA’ISYAH BALQIS BINTI SAMSON KAMAL 2022601318
4. SITI NABILAH BINTI MUHAMMAD MUHAIMIN 2022836806
MAHENDERAN
5. SITI NUR SYAFIQAH BINTI AZMAN 2022811144
6. NUR ELYANI BINTI SUHAIMI 2022828918

GROUP: MHM1111E
PREPARED FOR: NORAZMAN BIN HARUN
SUBMISSION DATE: 13 JANUARY 2023
 TABLE OF CONTENTS
NO CONTENTS PAGE
1. Title Page
2. Table of Contents
3. Acknowledgement
4. Chapter 1: Introduction
1.1 Company Background
1.2 Levels of Management
1.3 Types of Managers & Skills
1.4 Company Products or Services
5. Chapter 2: Planning
2.1 Vision, Mission
2.2 Types of Plans-Explain Standing Plan & Single Use
6. Chapter 3: Organizing
3.1 Types of Departmentalization / Organizational Structure
3.2 Types of Organizational Structure Either Flat or Wide Structure
3.3 Organization Structure
7. Chapter 4: Locus of Decision Making
4.1 Program Decision & Non-Program Decision
4.2 Example/Evidence
8. Chapter 5: Motivation
5.1 Motivation Theory
5.2 Motivation Program
9. Chapter 6: Leading
6.1 Leadership Theory
6.2 Example/Evidence
10. Chapter 7: Controlling
7.1 Type/Process of Control
7.2 Example/Evidence
11. Conclusions
12. References
13. Appendices
 Acknowledgement

Alhamdulillah, all thanks is due to Allah, the Most Gracious and the Most Merciful, for
giving us the perseverance and blessings that enabled us to finish this research, especially
throughout all of our difficult and trying circumstances. We cannot deny that we faced many
challenges while we travelled to finish our report, and as such, we are really appreciative of
Your unwavering love and grace throughout the entire voyage. First and foremost, we would
like to express our sincere gratitude to our enthusiastic instructor, Sir Norazman bin Harun,
for his tolerance, constant direction, counsel, and tremendous assistance in enabling us to
accomplish this study. He has been the key support for our evaluation by giving us a lot of
ideas and advice that have helped us finish this report successfully. We would want to thank
our lecturer once more for his willingness to give up his time to respond to our WhatsApp
messages and for helping us generate high-quality research. In addition, a particular thanks
goes out to the entire group for contributing plenty of ideas and energy, and despite all the
difficulties we faced, we still managed to cooperate and successfully complete this job. We
are extremely appreciative and pleased to be a part of the same group as one another since we
get along great and have a growing friendship. Last but not least, we want to express our
sincere gratitude to our dear parents for allowing us to tour the water treatment facility and,
of course, for their unending support, love, and prayers. A big thank you as well to everyone
who indirectly helped with the completion of this assessment; your generosity means a lot to
us. Many thanks.
 Chapter 1: Introduction

1.1 Company Background

Figure 1.1: Nestle’s Company Logo

One of the biggest multinational organizations in the world, Nestle specializes in producing
food, drinks, dairy products, and healthful items for people of all ages as well as for animals.
Henri Nestle founded his business in 1905 by merging the Anglo-Swiss Milk Company, and
gave it the symbol derived from his name. It has 447 factories, operates in 194 nations, and
employs 339 000 people, with Malaysia being one of them. The company's emblem, which
depicts a nest with a mother bird guarding her young, is representative of the care that they
provide (Figure 1.1). Since almost a century ago, Nestle in Malaysia has been dedicated to
giving Malaysians high-quality products. Nestle was founded in Malaysia's Penang in 1912,
growing and expanding to Kuala Lumpur in 1939. It took 134 years to became a largest
company in the world.
 Figure 1.2: Evolution of Nestle

Figure 1.2 depicts Nestle's evolution from 1867 to 2001. Nestle was established in 1867 by
Henri Nestle. After one year, he becomes the founder of his brand after purchasing the first
factory outside of Switzerland. Nestle was the first company to release instant coffee over
other brands in 1938. In addition, after becoming a successful entrepreneur, he increased his
stake in the cosmetics company L'Oreal and bought a number of other businesses, including
Alcon, Pasta, Perrier, and others.
1.2 Levels of Management

Top Level Management

CEO Nestle Malaysia, Juan Aranols

Middle Level Management

CFO Nestle Malaysia, Syed Saiful Islam

CNEB Nestle Malaysia, Tan Sri Dato Seri Anwar Jamalullail

Lower-Level Management
DNEB (1), Datin Sri Azlin Arshad

DNEB (2), Chin Kwai Fatt

Figure 1.3 Nestle’s Level of Management

Figure 1.3 shows Nestle’s Level of Management. Top Level Management contains of board
of directors, chief executive or managing director. The top management is the final source of
authority and it manages aims and policies for an initiative. Top management broad policies
of the enterprise and lays down the objectives.

Middle Level Management contains the branch managers and department managers
constitute middle level. They are responsible to the top management for the operative of their
department. They devote more time to directional and organizational functions. They execute
the plans of the organization in accordance with policies and directives of the top
management.

Lower level is also known as operative/supervisory level of management. It contains of

supervisors, superintendent section, officers etc. Assigning of jobs and tasks to various
workers. They instruct and guide workers for day-to-day activities.
1.3 Types of Managers and Skills

Chief Executive Officer

Figure 1.4: Mr Juan Aranols

Mr. Juan Aranols in Figure 1.4 has been the CEO of the company since 2018. He also served
as the CFO (Chief Financial Officer) and senior management team member for Zone Asia,
Oceania and sub-Saharan African at Nestle SA from 2015 to 2018. Having built a solid
foundation in finance and strategy through his different roles as CFO in different countries
and regions.

Chief Financial Officer

Figure 1.5: Mr. Syed Saiful Islam

Mr. Syed Saiful Islam in Figure 1.5 has been the Director and CFO of the company since
August 2022. He started his career in Nestle in 1999 in Bangladesh as Financial Accounting
Manager. He is a strong finance person doubled by a true manager. He successfully
handled whole the responsibilities in line with is function, plus demonstrated courage and
unshakable loyalty to his colleagues and company, during difficult moment he went through.
Chairman Non-Executive Board
 Figure 1.6: Mr. Y.A.M Tan Sri Dato’ Seri Syed Anwar Jamalullail

Mr. Y.A.M Tan Sri Dato’ Seri Syed Anwar Jamalullail in Figure 1.6 has been Chairman of the
company since 2009.  Having served the Board for over nine years, Tan Sri Syed Anwar
was re-appointed as an Independent Director at the 33rd Annual General Meeting held last
year. 

Director Non-Executive Board (1)

Figure 1.7: Ms. Datin Sri Azlin Arshad

Ms. Datin Sri Azlin Arshad in Figure 1.7 has been a director of the company since 2020. She
is member of the audit Commit-tee. With Honours degree in accounting and finance,
University of Glamorgan and graduate of ICLIF’s high performers’ leadership programme
she can proof that woman also can be successful.
 Director Non executive Board (2)

Figure 1.8: Mr. Chin Kwai Fatt

Mr. Chin Kwai Fatt in Figure 1.8 has been the Director of the company since 2021. Currently,
he served as a Director at Dialog Group Berhad. He holds an honours degree in Economics
from the University of Hull, United Kingdom. He has more the 30 years of experience in
leadership roles and consulting services, involved in a broad range of business advisory
services and strategic Information technology services to clients across diverse industry
sectors.
1.4 Company Products and Services

Figure 1.9: Companies Run by Nestle

Figure 1.9 shows that Nestle manufactures a wide range of goods, including coffee such as,
Nescafe, Nespresso, Taster’s Choice and Coffee Mate. Next is drinks for example, Nestea,
Vittel, Poland Spring and others. Ice cream brands that are well known are Drumstick, and
Dreyer’s. Nestle also do a dairy, confectionery, culinary, frozen food and new-born nutrition.
Several famous brands were owned by Nestle, including KitKat, Milo, Maggi, Nestum and
others.

Chapter 2: Planning
2.1 Nestle’s Vision and Mission
2.1.1 Mission
Nestle strives to be the full-line provider of nutrition, health, and wellness to every country in
the world to assist consumers in their everyday lives. Their mission of "Good Food, Good
Life" is to meet the ever-changing needs of consumers and pets alike by continually doing
research and development.

2.1.2 Vision
To be a leading, competitive, Nutrition, Health and Wellness Company delivering improved
shareholder value by being a preferred corporate citizen, preferred employer, preferred
supplier selling preferred products.

2.2 Types of Plans-Explain Standing Plan & Single Use

2.2.1 Standing Plan
Standing Plan is a management action guideline. Because it can be used repeatedly, it helps
to bring consistency to day-to-day business operation. For instance, they will make sure they
produce good quality food. Nestle is responsible for ensuring food safety because that is their
top priority. They have a policy, procedure and rule. For example about policy, they are
responsible for addressing the prevalence of food infections. And then about procedure, to
avoid cross-contamination, Nestlé's plants around the world including those in Central and
West Africa, have specific zones, pieces of equipment, and utensils for various ingredients.
Besides, using cutting-edge technology, Nestlé worldwide conducts 100 million tests a year
on its goods, including 1.5 million for salmonella to check for hazardous germs or chemicals.
Furthermore, to ensure they are safe for consumption, items issued from Nestlé factories must
pass "positive release" testing. Once the products are available, clear and easy-to-understand
instructions are supplied on how to prepare, store, and utilise the product. Best before’ and
‘use by dates’ are highlighted. So that people can know when it is no longer safe to eat or
drink the product. Lastly, about rule. Nestlé has trained all its employees about good
manufacturing practices, and they must follow certified cleaning and sanitation.
2.2.1 Single Use

Single Use Plan is a one-time plan created to address specific conditions or situations that is
unlikely to be repeated in the future. For example, One of Nestlé’s marketing strategies is
through sponsorships, promotions and advertisements. With each of these, Nestle can
promote its brand and products to a specific audience. They have a program, project and
budget. For instance about program, Nestlé Malaysia has offered to help with the distribution
of nutritious meals to front-line workers at AstraZeneca's Vaccination Administration Centre
at the Ideal Convention Centre (IDCC) in Shah Alam. About project, the food and beverage
(F&B) manufacturer will also distribute 'goodness packs' to those who have been vaccinated
as part of its ongoing commitment to support Malaysians during the pandemic through its
Nestlé Cares volunteer programme (Figure 2.1). Frontliners from Malaysia Civil Defence
Force (APM) also help to make the program going smoothly (Figure 2.2).

Figure 2.1: NESTLÉ CARES “goodness packs” distributed to vaccine

recipients at IDCC.

Figure 2.2: Frontlines on duty including the Malaysia Civil Defence Force (APM)

receive nourishing packs from NESTLÉ

 Chapter 3: Organizing

3.1 Types of Departmentalization

3.1.1 Matrix Structure
 For a long time, Nestlé managed its business using a complex, decentralized matrix
organizational structure that allowed its subsidiary brands and businesses to operate with a
high degree of autonomy and independence. To handle its global operations, the corporation
underwent a significant reorganization in October 2021 and was divided into five new
regional zones.

3.1.2 Geographical Structure

Operational divisions of Nestlé are divided into five major geographic areas. For many years,
Nestlé, a global food and beverage business based in Switzerland, operated with a
decentralized matrix organizational structure that allowed its various brands and subsidiaries
to function independently. Figure 3.1 shows how Nestle be divided in Geographical

Structure.
Figure 3.1: Nestle’s Geographical Structure
3.2 Types of Organizational Structure Either Flat or Wide Structure
Nestle types of organizational structure is a wide structure (Figure 3.2). Nestle organization is
divided into 3 types of management, top-level management, middle-level management, and
low-level management. The board of directors, the CEO, or the managing director are
included. The senior management oversees an initiative's goals and objectives as the ultimate
source of power. It spends more time organizing and arranging tasks. Middle level managers
include branch managers and departmental managers. For the employees in their department,
they answer to the senior management. They spend more time on organizing and guiding
duties. Operative and supervisory level of management are other names for lower levels. It
includes officers, the superintendent section, and supervisors.

Figure 3.2: Nestle’s Wide Structure

3.3 Organization Structure
In an organizational structure span of control is another important thing. That means the
number of subordinates immediately reporting to a superior official. Nestle have narrow span
of control because it has large number of levels of management hierarchy. Narrow span of
management requires a manager to supervise a small group of employees, resulting in a tall
or vertical organizational structure. Costlier than a wide span of management, there will be
more managers and a higher number of communication issues among different management
levels. A long chain of command and bureaucratic control exists whereby slows decision-
making. In the end, the nestle organizational structure that we can conclude is that they are
purposely, creating coordination for employees behind a set of strategic priorities on the way
to boost up the success of business enterprise objectives. Organizing Nestle ensures progress
today and guarantees success in the future.
 Chapter 4: Locus of Decision Making

The locus of decision making for Nestle is decentralized. Nestle is a decentralized

organization where authority for operating choices is distributed to local units, which have a
high degree of autonomy over pricing, distribution, marketing and other. Nestle faces many
challenges as a global company. They cover a wide range of social, environmental, and
economic issues, and their sizes range from the local to the international.

4.1 Program Decision & Non-Program Decision

4.1.1 Program Decision:
Program decision are the one that have been structured. It is unchanging or a decision that be
a routine and can be clear up through clear-cut mechanical procedures. The management
decisions that have been programmed are up to 90%. For example, UiTM has set the rules for
student to follow the dress code, display of student cards while on campus, etc.

4.1.2 Non-Program Decision:

Non-program decision is unstructured and need higher-level management participation. It
usually has to distribute with a distinctive, uncommon or unexpected problem. It requires
non-routine decision-making that occurs in response to exceptional, uncertain opportunities
and threats. For example, the government have to take an action to prevent the Covid-19
pandemic outbreak from spreading.
4.2 Example/Evidence
4.2.1 Program Decision

4.2.1.1 Raw Materials

Figure 4.1: Milk was extracted from the cow by vacuum

Nestle starts their quality management on farms. Nestle will collects fresh milk from farmers
at their Collection Centres every day and tests the milk right on the spot to confirm its
quality. The higher the quality, the higher the farmer’s salary. Figure 4.1 shows how the fresh
milk were produced at the Collection Centre.

4.2.1.2 The Nestle Incubator

Figure 4.2: Milk was held in Nestle Incubator

When the products come out from the factory production line, they are held in a storage
facility that in known as Incubator to have their final quality test (Figure 4.2). Nestle
Laboratory will check the product on each batch. After all the products have passed the test,
Nestle will released it to shops and supermarkets.
4.2.2 Non-Program Decision
4.2.2.1 The Global Water Crisis
In recent years, water have been recognized as a serious environmental issue. There will be a
huge problem for Nestle food supply future if they can’t find a solution to the global water
crisis. To cut down the water usage at their facilities and plants, Nestle have implemented
strict guidelines. They also assist farmers in being better stewards of their water use, support
programs that raise awareness of water resource issues, and engage in international
discussions with top researchers and decision-makers.

4.2.2.2 Covid 19 Pandemic

Figure 4.3: Fellow vaccine recipient, Nor Isra Illiani showcasing the "Goodness Packs"
containing Nestlé products, received at Ideal Convention Centre (IDCC) during the first
vaccination phase.

Covid 19 have give a huge impact around the world. During the pandemic, Nestle focus on
their employees health and protect them to ensure steady reliable supplies to support the
community. All the employees that work at the factory were the front-liner. One of the
actions that Nestle take is asking their workers for not travel internationally even for
businesses purpose until further notice. Nestle Malaysia also extended help by provided a
Vaccination Administration Centre for AstraZeneca at the Ideal Convention Centre (IDCC),
Shah Alam and give some Nestle products to them. Figure 4.3 shows a women get her first
vaccination phase at the IDCC Shah Alam.
 Chapter 5: Motivation

5.1 Motivation Theories

Maslow's hierarchy is a motivational theory that has five categories based on human needs,
which helps to identify an individual's behaviour. (Figure 5.1)

Figure 5.1: Maslow’s Hierarchy of Needs

5.1.1 Self-Actualization
Explained Maslow, referring to human needs to reach their full potential as human beings,
among the things they can do is contribute to society. By working at Nestle they can help the
community by providing high quality products as well as helping in researching products that
suit the needs of the community.

5.1.2 Esteem Needs

Esteem is self-respect nestle gives respect through the career management center, training
and development programs, shared responsibility with employees and managers and human
rights. Nestle fully supports The United Nations Global Compact's two guiding principles on
human rights. Nestle therefore support and respects the protection of international human
rights within its sphere of influence.
5.1.3 Social Needs
Social needs in Maslow's hierarchy include things like love, acceptance and belonging. At
this level, the need for emotional connection drives human behavior. Therefore, Nestle
provides a working environment that meets these needs including friendship, family and
social groups.
5.1.4 Safety Needs
Safety is a very important aspect. Among the examples of safety is security of body, of
employment, of resources, of morality, of the family, of health and of property. Nestle
provides a safety management system in the workplace (nestle occupational health and safety
management system. Nestle also implements a behavior-based safety program for employees
and gives a Safety Award in the workplace (to promote a safety culture).

5.1.5 Psychological Needs

Psychological needs are basic human needs. For example, food, water, breathing and
homeostasis. Nestle provides nutritious food, provides clean water supply and homeostasis
(Residence for employees).

5.2 Motivation Program

5.2.1 Nestle recognizes the need to provide a creative and conducive work environment for
employees to thrive, encouraging them to perform better as it energizes people and keeps
them motivated to work. This program uses Maslow's hierarchy, which is self-actualization,
because it hones the talent that young people have until they reach their full potential and can
contribute to society.

5.2.2 Nestle is very concerned about human rights related to their employees. Therefore,
Nestle believes in fostering a "Speak Up" culture where employees feel empowered to raise
concerns about their safety without fear of consequences. Nestle can then be confident that it
is making a positive contribution to society. Nestle encourages the reporting of abuse of
power, harassment, bullying, fraud, and safety. These structures and policies have helped
reduce the number of health and safety incidents.
5.2.3 Nestle strives to make its business a great place to work now and in the future. Every
aspect of how Nestle treats its employees is rooted in respect. Their health and well-being are
priorities, and Nestle brings purpose and values to life through a diverse and inclusive
workforce that leaves no one behind. As well as Nestle's direct employees, their suppliers are
equally committed to the continued health, well-being, and economic progress of the
communities in their supply chain that provide us with raw materials.

5.2.4 Nestle had set up a management system called "Nestle Occupational Safety and Health
Management System." This system is more focused on preventing accidents. Nestle uses this
management system to prevent employee accidents by promoting some of the safety program
to the employees. Nestle is committed to providing a safe working environment for its
employees, so they establish a local safety and health organization from which managers and
employees can seek specialized advice. 

5.2.5 Nestle is providing for the basic needs of their employees, such as rest time for them to
eat, drink, and rest. It is to let them feel relaxed when they are working. The limitation is that
when the Nestle company gives the employees more time to rest, the employees become lazy
and spend more time resting than working, whereas when the employees are given less time
to rest, they are dissatisfied.