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Unilever – A Multinational Corporation

Questions:

1. Critically evaluate the need for and methods of strategic planning for the organisation?
 
2. Analyze and select appropriate tools and techniques for the strategic planning of a corporation’s information system?
 
3. Recommend a strategic model for the organization. Justify the choice of the model?
 
4. Establishing the information requirements and evaluate Information Systems which would give a competitive edge to this organization. You may also include information systems that enhance the Customer Relations Management.    
 
5. Critically discuss the societal issues raised by Information Management?

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i. About Unilever

Unilever is a multinational corporation that sells consumer goods in many countries. The company was founded in year 1929 and since then it has been consistently developing its area of operation in various countries. The company headquarters in Rotterdam. The main products of sale include fast moving consumer goods, body care products and cleaning agents. Unilever has been graded as the world’s third largest company as per the revenue statics in year 2012.0 At present the company has it presence over 190 countries and has become a successful business over years. In year 2013 it was estimated that the company employees 174,000 employees in different countries. The use of information and strategic management system has helped the company to control its area of operation in different countries.

ii. About strategic management

Strategic management is actually a process that helps in formulating and deploying policies and procedures that could help the company achieve its various organization goals and objectives. It helps in keeping alignment with the corporate objectives and goals with the company management so that a definite outcome is achieved which could help the sustenance of business in the long run.

iii. Need for strategic planning by Unilever:

Strategic planning for the Unilever includes the following of various steps and processes so that a definite set of policies, procedures and objectives that are framed out such that the organization could consistently attain growth and development for the coming years. The need for strategic planning to Unilever includes the followings.

1. To achieve consistent growth and development in business.
2. To increase area of operation in new countries.
3. To meet the changing demand of customers in different places.
4. To develop positive work culture in the organization.
5. To set goals and objectives for the organization.
6. To help employees attain high end goals and targets for the company.
7. To meet the changing environment requirements.
8. To review the past policies and procedures and bring changes to achieve high gains for the organization.

iv. Methods of strategic planning used by Unilever:

There are various methods of strategic planning which includes the followings.

The strategic planning used in by Unilever includes the setting of vision for future and setting goals for them accordingly. This way a proper vision of future goal is made as target for making strategic planning for the organization. This vision and mission statement includes the identification of various goals and issues to the organization along with the available resources so that the desired outcome is reached through vision based strategic planning process.  The steps followed in this process include the followings.

1. Setting up organization’s mission statement.
2. Establishing a vision statement.
3. Identifying and selecting goals for the organization which could help achieve the desired outcomes.
4. Recognizing the strategy that best suits the requirements.
5. Preparing action plan to apply the best suitable strategy.
6. Creating vision and mission statement.
7. Applying the mission statement in the organization.

Unilever vision is based on strategic planning method to identify targets and goals that the organization working in 190 countries need to follow through the managerial actions. This way the managers guide towards the following of a particular set of regulations in their respective organization so that the definite code of conduct is observed in an organization(Lynne et al., 2007).

Strategic Management System

2. Objectives of Unilever:

The objectives of Unilever include the identification of issues that are affecting the organization in the development process. This way a strategic management policy is framed and reviewed at regular intervals by high level officials of Unilever so that the identified issue can be resolved and the desired outcome is achieved. This way the main effort is to solve the problem and resolve the issue through the application strategic planning process in action. The objectives of Unilever include the followings.

1. Recognizing the major issue that is affecting the organization.
2. Getting expert advice to resolve the issue.
3. Getting suggestions for the solution of the issue.
4. Compiling a strategic plan to deal with that particular issue.
5. Applying the strategic plan for required term.
6. Reviewing the strategic plan application and making changes as per requirements.

The strategy of Unilever is to bring one direction or alignment so that the resources deployed can be used more effectively. Also the policy and procedural changes that are brought over time can be applied fairly on all the business departments(Ghemawat, 2003). The strategy for Unilever includes the followings.

1. Analyzing the present state of different departments of the business.

1. Reviewing the business operations and comparing it with the vision, mission, programs and guidelines that are actually required to be followed.
2. Evaluating the pros and cons of the business operation in different departments.
3. Identifying adjustments that can help.
4. Applying them accordingly in different departments.
5. Making strategic plans to when and where to execute the adjustments.
6. Review of the adjustments and making changes accordingly.

Unilever is a multinational organization which has its business in different countries around the world. Therefore it becomes necessary on the part of the organization to use various business tactics at different intervals. Due to these reason specific business procedures, policies, targets, values etc are framed and re-framed from time to time to deal with the various business problems. The main tactics used by the company includes the followings.

1. Relevancy of recognition of issue in strategic planning process.
2. Acceptability of the outcome through strategic plans.
3. Cost effective application for dealing with issues.
4. Use of required data in the planning process.
5. Outcome in the form of application should achieve sustainability.
6. Communicating the right meaning, policy and procedures to the employees.

Critics are of the view that strategic planning concept cannot help in achieving organization goals and objectives as they do not particular adds skills to the employees but guide them towards a definite direction(Bartram & Casimir, 2007). Strategic planning is done by the high level management. Therefore they may lack the knowledge about the ground issues and problems that is resisting the development process in the organization(Gadot, 2007). Strategic planning based on the earlier data, facts and figures. However these figures can be incorrect due to many reasons. This way the outcome in the form of policy or procedure may not meet the requirements(Gill, 2002).  Finally strategic planning brings in reviewed policies, targets and objectives which add to the problems of the employees who may start leaving jobs. This way it may become the cause of employee turnover in an organization(Ghemawat, 2003).

There are a number of tools and techniques for the strategic planning of a corporation’s information system which are discussed as below.

PESTLE analysis initials stands for Political, Economic, Social, Technological, Legal and Environmental factors affecting the organization. This way an external environment analysis can be done which can help the organization to know more clearly about the industry trend and other factors affecting the other companies as well. The PESTLE analysis for Unilever in United Kingdom is displayed as follows.

Political	The political environment of Unilever in United Kingdom is very much favorable as it supports the development of business models that has the capacity to earn from international fronts as well.
Economic	The economic slowdown has affected the economy in the United Kingdom, however the products sold by Unilever are mostly necessity good items whose sales is hardly effected.
Social	The customers in United Kingdom are rationale and they prefer Unilever products it qualifies all the requirements related to quality. Along with that Equal employment opportunity is offered to the people in United Kingdom and other countries.
Technological	Unilever follows complete automation for the production purpose. Therefore the company has appropriately upgraded its technological requirements over time to serve customers better.
Legal	Unilever follows all legal guidelines that are established with a view to generate quality outcome and conserve customer rights.
Environmental	Unilever has followed all guidelines as per International conservation laws and acts to preserve the natural environment not just in the United Kingdom but in all other countries where it operates.

SWOT analysis means analysis of internal strength and weakness of the organization along with analysis of the external opportunity and threats.  This method helps in accessing the present state of business in terms of internal and external environment. Efforts are made to realize the present strength and weakness of the business. Also the identification of the possible opportunities and threats to the business is identified. This way the strategic planning process will get the best, exact and most desired information so that the most feasible policy and plan can be formulated (Northouse, 2004).

Strength	1. Unilever has years of experience in business which has lead to earn various economics of scale. 2. The company has well qualified staff that adheres with the company guidelines. 3. Unilever has a well established brand name in the market. 4. The company has achieved specialization in the business process.
Weakness	1.  The rising incomes of the employees have directly affected the cost of production. 2.  Unilever has a huge management in 190 countries which may require attention at times but the same cannot be achieved as it is tough to be handled in one day. 3.  The economic slowdown has affected sales of its various products and services.
Opportunities	1.  Direct invitations are received by Unilever from various economies to start their operation in their country. 2.  The well established brand name of Unilever has helped the company in developing in various other businesses.
Threats	1.  The rising number of multinational producing similar products has been affecting company’s sales. 2.  The rationale customer which looks in quality also checks for prices which at times does not convince them for purchase of Unilever products and services.

Methods of Strategic Planning

It is a method that helps in recognizing the restraining forces on one side that hold the business backwards and the driving forces on other side which support the development and progress of the business. This way the strategic planning is supported by the recognition of various factors affecting business in the form of two distinct heading called restraining forces and driving forces. Efforts are made to deal and minimize the effect of restraining forces and develop and support the driving forces so that the business can achieve a high end gains and consistency in development.

The best used method for strategic planning for Unilever includes the force field analysis. Unilever is operating business in 190 countries. This way there exist a number of factors that may support or restrain business from growth. This method can help the company in supporting the driving forces and controlling factors that acts as restraining force. Therefore the goal achievement and target setting can both be improved through the application of the force field analysis in the strategic planning process. The factors that may affect as driving or restraining factor may include the price change, political factors, social factors, economic factor etc(Young et al., 2004).

The force field analysis for Unilever can be done as below.

Restraining forces

1. Increase in number of multinationals. 2. Homogenous products are produced by competitors. 3. Economic slowdown affecting the sales of various goods. 4. New brand names and products are capturing markets. 5. Changing customer taste and preference affecting the company business. 6. Increasing expenditures on advertisement adding to cost of production.

Driving forces

1. The brand name of the company facilitates it to showcase new products and services in the market. 2. The customer preferring quality products and services prefer to buy Unilever products. 3. Highly experience staff helps in meeting the corporate targets easily. 4. The customer loyalty towards company products help it to continue to grow and prosper. 5. Highly mechanized production system helps the company to stay away from the various HRM issues and problems.

A number of strategic models that can be applied to the organization includes the followings.

1. PESTLE analysis:
2. Porter’s five force analysis:
3. SWOT analysis:
4. Growth share matrix.
5. Balanced scorecards and strategy maps.

The best strategic model for the Unilever organization will be the Porter’s five force analysis. Porter’s five force analysis actually helps in recognizing the various external factors that affects industry attractiveness such as follows.

1. Industry rivalry.
2. Bargaining power of supplier.
3. Bargaining power of buyer.
4. Threat of substitutes.
5. New market entrants.

 This can be explained in context to Unilever is discussed as follows.

1. Industry rivalry:

Unilever has its area of operation in 190 countries. These countries have various other multinationals and domestic companies operating in them. This way an industry rivalry exists at different locations in the world market where Unilever has its presence. The various other global brands such as Procter and Gamble, Colgate-Palmolive, Reckitt and Coleman etc creates industry rivalry in different locations by presenting homogenous products in the markets at competitive prices. Thus starts a price war and various other marketing techniques to deal with the industry rivalry(Oribabor, 2009).

2. Bargaining power of supplier:

The bargaining power of the supplier to the Unilever is very limited. This is because of the reason that the company has its presence in various countries. This way the company has a variety of options to select from the suppliers available at different locations. Thus the company selects the most appropriate supplier who fulfills the terms and conditions of business and brings in cost effectiveness.

3. Bargaining power of buyer:

In the present day world, the bargaining power of buyer is high in different countries. Actually the consumers in the present day world are rationale and thus make wise decisions for purchase. This way the customer of today is rightly referred as a king as he or she has the power to select from the variety of products and services available in the market. The bargaining power of the buyer therefore helps to keep the prices and quality of products and services of various multinational under control(council, 2006).

Objectives of Unilever

4. Threat of substitutes.

Unilever actually produces homogenous consumer products. This way there always exist threat of substitutes in different world markets. A number of similar products and services are available in the world market that can easily replace the products and services manufactured and sold by Unilever. With the development of various multinationals corporations in different countries the threat of substitute has actually risen in the recent years.

5. New market entrants.

With the open door policy prevalent in the world markets, the new market entrants are free to come and go. The result is that various homogenous products are easily available in the market that could compete the quality, quantity and availability of the Unilever products. Although the company has maintained its quality from years but the losing of control over the prices has resulted in the increasing opportunity for the new market entrants to try their luck. However the company has been able to achieve the target goals in the last decades and expects the required level of development and sustenance in the coming years.

The Porter’s five force analysis can be displayed as follows.

1. Strategic Level :

The information requirement for the Unilever will be needed for the purpose of achieving effectiveness in inbound logistics operations. This way the company can keep a good track and control over the requirements, receipt and storage of the material. Also the information system could help Unilever in improving the outbound logistics process as well by helping in collecting, controlling and reviewing the outbound logistics system. This includes the review of the physical distribution channels so that the orders can be quickly delivered and time wastage can be avoided.

The use of DSS or Decision Support System can help in integration of various logistics activities so that the most cost effective and strategically beneficial decisions are taken with the help of information system.  This way the unnecessary delays can be avoided and the containers can be transferred after complete filling up.

2. Tactical Level:

Information system can help Unilever in easing the procurement process as it will help the related department to send direct quotations to the suppliers and select the best deal out of them. This way an alignment in the purchase of raw material can be achieved.

The information system that can be used to deal with the tactical level strategic management requirements includes the application of the ERP system ERP or Employee Resource Planning system can help in evaluating the requirements of the human resource in the organization This way the number of new recruits and kind of academic knowledge they should possess can all be identified by using ERP system.

3. Knowledge Level:

Information system can help Unilever in supporting HRM or Human Resource Management in different countries. This way the recruitment, training and development of the human resource can be achieved in 190 countries by the related authorities of Unilever.

The system that can help supporting HRM activities includes MIS or Management information system. This system helps in gathering and analyzing the management related information such as number of employees in the company, requirement of training, number of employees looking for promotion, rising absenteeism rate etc. This way the information system helps in easy access and analysis of the information that could help support the various human resource management related activities.

Unilever’s Strategy

4. Operation Level :

The information system could also help Unilever in the normal operations in different countries. This way the manufacturing capacities can be increased through the improvement information management system which helps decrease consumption time and wastage(Ghemawat, 2005).

Along with that the Information system developed can help Unilever in achieving healthy customer relations by fulfilling their respective needs and responding them on time. This way the customer will get loyal to the company and continue to prefer purchase of its products and services.

Also the Information system can help Unilever in supporting various business activities from customer end by offering after sales service to employee support by adding email id and contacts direct linked with the high officials. This way various business activities can be supported through information system which could enhance business capabilities.

CRM or customer relationship management can help the company in achieving high level of satisfaction. Also the customer expectations can be identified and met through the placement of new products or addition to present products. This way CRM system helps managing the customer relations in a better way.

This way the below stated various benefits of information system evaluated for Unilever.

1. It helps in achieving economics of scale to the business.
2. It helps in quick and easy movement of information.
3. It helps in maximum capacity utilization of the available resource by the organization.
4. It helps in bringing linkage in the value chain.
5. It helps in building inter-relationships in different departments which helps in reducing costs and achieving higher objectives easily.
6. It helps in integrating various business activities.
7. It helps in saving time.
8. It helps in evaluation process.
9. Decline in idle time is achieved.
10. Low risk factors affecting business operation.

(Caniels & Gelderman, 2007)

The various societal issues that are raised by information management system include the followings.

1. Challenge to privacy:

Information management system has seriously affected the privacy issues related to personal contact information and contacts. This way in the present age of information and technology the privacy is at stake.

Critics are of the view that some compromise of privacy loss is fair enough to get the best and most desired outcome. In the present day world, the loss of privacy due to social networking sites has resulted in various benefits. Also there is availability of control over privacy contents which could deal with this issue.

2. Issues related to trade secrets:

Issues related to trade secrets rises when the company’s has to display the business related information as per the government direction and corporate governance policy. This way various trade secrets like buyers and sellers information gets displayed to the competitors.

In the present day world it has become really important to disclose information to the public and government agencies so that the security of the country and their countrymen can be assured. Therefore compromising some level of trade secrets to the public is just  nothing before the safety of the country whose money can used against them by the evil forces.

3. Increasing dependence on machines.

With the more utilization of machines the dependence on machines has risen manifolds. This has resulted in affecting the learning process of human beings which used to make calculations and decision depending on their personal abilities to analyze and calculate situations.

Critics are of the view that increasing dependencies has helped in easing the learning process and thus the present day people including children are much more capable of learning than a decade old children.

4. Job loss:

Information technology has resulted in job loss of many people due to increasing automation in the business operation. This way a number of people have to lose job because the machines were there to handle their work. Therefore job loss is the most adversely affecting outcome of information technology.

Tactics Used by Unilever

Information technology has resulted in increasing job opportunities also. In the present day world, it has helped in generating those job opportunities which did not even existed a decade back(Bartram & Casimir, 2007).

5. Health risks:

Various health risks such as eye strains, repetitive strain on bones and other body parts are among the various health issues that have developed with the use of information technology. This way the rise in health has risen due to various increasing usage of information technology.

A controlled and right use of technology can help in avoiding health related risks. Therefore it’s not the information technology itself but the carelessness of the users which creates problem.

Conclusion:

In the end, the Strategic management planning and information system has helped Unilever, other businesses and people along the globe to achieve improvement in the regular business process. This has helped in achieving high gains to the company and has facilitated the working process.

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