Sustainability Challenges Of Nestle And Recommendations For Improvement

Carry out an extensive market research to understand the current need of the customers

Recommendations building on the vision and environmental analysis on Nestle

Nestle company has faced sustainability challenges during their business. One of the major sustainability challenges of this organization was a worldwide boycott. This organization was accused of the unethical work and wrong marketing procedure. This is the main cause of the infant death of such organization (CSREurope, 2018). Based on the vision and environmental analysis of Nestle some recommendations are as followed, which will be beneficial for this organization:

Carry out an extensive market research to understand the current need of the customers

According to the new vision of Nestle is to become the world’s first choice provides for foods. In order to complete this vision, such organization needs to identify the current market demand to implement their strategy. Market research helps an organization to bring success in the marketing campaign and in-turn sales (Jaworski & Kohli, 2017). The proper market research will help Nestle to identify their new business opportunity and to design their marketing campaign. This will help them to target directly their audience and to enhance the sales. Nestle has been facing problem due to their marketing. For a better marketing, this organization should implement a customer-centric business. Market research will enable this organization to gather valuable information regarding the potential of a specific market segment within a specific time for a specific age group. Nestle wants to get the first position in the food industry in the global market. However, their sustainability challenges resist them to grasp such opportunity as they have faced many boycotts. To give shape their new strategy this organization needs to follow an extensive market analysis.

Market research helps this organization to keep a tab on their major competitors. Market research is considered as a great tool to make a comparison with other organizations (Yang & Gabrielsson, 2017). By using such tool Nestle can keep track on their company growth and the current position of their competitors in the market. On the other hand, market research helps an organization to avoid loss and to establish a sustainable business in the international market. In the context of Nestle company conduction of a huge market research will be beneficial as it will lead them to fulfill their current vision and get number one position in the global food industry.

Improve the supply chain management to ensure food safety by using six sigma and TQM

Improve the supply chain management to ensure food safety by using six sigma and TQM

Many products of Nestle are rejected by the New Zealand government due to the poor quality supply chain and infectivity of such products. In order to penetrate and keep the business within New Zealand Nestle needs to comply with government regulations of this country. As per the rule of HACCP or Hazards Analysis or Critical Control Point, the food should be secured while it is imported in a new country. In the context of Nestle, they need to register their organization under Food Act 2014, which is the government regulation of New Zealand. According to this regulation, the food sectors need to maintain the hygiene and to take control over the food processing (Legislation.govt.nz, 2014). Nestle has faced issue regarding their food quality due to their poor supply chain. Use of total quality management six sigma tool is helpful to ensure the quality and remove the viability from the supply chain. They need to bring improvement in the entire supply chain process that is from collection of raw materials to the packaging. Each step of food processing should be done in a hygienic and aseptic way. Implementation of proper auditing process during the collection of raw materials will be helpful for Nestle to ensure their food safety. Therefore, use of clean and safe equipment and proper pest control process during the manufacturing is mandatory.

Application of positive release test will be helpful for the food sector to ensure that the food is safe to consume (Rueda, Garrett & Lambin, 2017). On the other hand, Nestle should ensure that the packaging is done at optimum temperature and each product should be packaged with the proper date. Including such steps in the supply chain management will be helpful for nestle to ensure the safety of their food product, which will beneficial for them to get an entry in New Zealand.

Us of modern technology in food production

Despite the adoption of the new technology Nestle has been facing quality problem in their food products. Hence, use of nano-biotechnology in their food processing and packaging will be beneficial to enhance the innovation. This technology is crucial to attach the antibody to the food and to detect the pathogen from the food (Ojha et al., 2017). Incorporation of such technology will be beneficial for Nestle to reduce their quality issue in the product. On the other hand, use of super dry technology will help such organization to preserve the seasonal food throughout the year and keep its nutritional value.

Us of modern technology in food production

Expand the market share in new market

Nestle wants to penetrate the mature market that is a major weakness of this organization. In order to increase the sale, an organization needs to focus on the new market that is not matured yet (Christopher, 2016). Hence, Nestle needs to expand their business in the new market, where is no rival or similar industry. This will be effective to enhance their growth in a specific market.

Development of organic product

Nestle has been facing problem for their product Plain Yoghurt as it fails to make a strong presence in the operating market (CSREurope, 2018). Hence, production of the health-conscious product will be helpful for such organization to capture a large proportion of the customers who are health conscious.

a) Development a detailed timeline in order to achieve the growth over next 10 years in the context of Nestle

Selected milestones	1st year	2nd year	3rd year	4th year	5th year	6th year	7th year	8th year	9th year	10th year
Market research
Improve the supply chain
Application of nano-technology
Penetrate in the undergrowth market
Introduction of organic product

Table 1: Time Frame for the Five milestones

(Source: Author)

Analysis

Nestle has been facing sustainability challenges to operate their business in New Zealand. Their first approach is to carry out a good market research to get the number one position in the global food industry.

Process to carry out the market research

Problem identification is the first step of market research (Beske, Land & Seuring, 2014). Nestle needs to identify their exact issue and then carry on the market research process. After identifying the issues this organization needs to accomplish a formula and by using analytical model. Research design formulation is crucial to make a market research as it acts as the blueprint for a market research (Grant, Wong & Trautrims, 2017). Step four includes field work and collection of data based on the current market trend. Step five includes data preparation and step six includes preparation of the report. Such six steps are crucial for Nestle to complete their market research and to identify the demand of their target audience. Steps to improve the supply chain

Nestle has been facing the quality issue in their product due to their inappropriate supply chain management. In order to improve their supply chain process, they will take 3^rd and 4^th year. During this period they need to make an audit to ensure the quality of their raw materials. Therefore, they will develop a team to check the equipment and the cleaning process of the manufacturing zone. Testing of the product is crucial for a food industry to ensure its safety (Chardine-Baumann & Botta-Genoulaz, 2014). They will incorporate positive release test to check the quality of the food. Therefore, they need to use modern technology in their packaging process such as pneumatic technology for safe packaging. To accomplish such steps six sigma and TQM tool will be helpful. However, six sigma tools help to measure, analyze and improve the process of supply chain. On the other hand, application of TQM helps the organization to bring continuous improvement in the quality of the product and collecting feedbacks from the stakeholders.

Expand the market share in new market

Actions that are taken to use nanotechnology

Application of the nanotechnology in food processing needs more time as it is a complex and costly process. Nestle aims to take 5^th, 6^th and 7^th year to adopt nanotechnology in their food processing. This helps a food industry detect pathogen from their food particles (Touboulic & Walker, 2015). Such organization will recruit a team includes experts, who are highly knowledgeable about the nanotechnology. For this reason, Nestle has targeted to enhance their funding as the application of nanotechnology is an expensive process. They have decided to increase their partnership work to boost their fund to use nanotechnology.

Get entry in the new market

Nestle aims to expand their market share in the matured market, which leads them to face huge competition. However, it is important for an organization to focus on the market, which is not matured while starting a business in the new country (Brandenburg et al., 2014). Nestle has started their business New Zealand thus, they need to capture those markets which are undergrowth and where the less number of competitors are present. To identify such type of market Nestle needs to make marketing team who are able to find out a suitable market for their new business in a country. In the next step, Nestle needs to identify the trend of this market. Based on the trend they need to introduce their product. Therefore, they have to develop marketing strategy especially the pricing strategy to get an entry in this market. They need to use low pricing to cover a large number of customers in this particular market.

Produce organic product

Nestle has introduced Plain Yoghurt, which is failed to attract the target customers. Hence, based on this situation Nestle needs to introduce organic food products to cover the health-conscious customers. In the recent years, maximum people are health conscious and they prefer food products, which are healthy and tasty for them (Touboulic & Walker, 2015). In order to introduce an organic product, they need to select good suppliers to get fresh and hygienic raw materials for their product. After selection of the product, they need to get a license to sell their product. Therefore, they need to develop strategy and register it with the appropriate government agencies. To sell the organic product direct marketing is necessary at the initial stage. Nestle can market their product directly by using different marketing channels as for example, CSA and grocery are good channels to accomplish a direct marketing. On the other hand, promotion is crucial while developing a new product. Nestle should promote their product by using proper advertising, which will help the target audience to know about the new product. Advertisement through the social media will be helpful for Nestle to launch their new product in the market.

b) Discussion of the most immediate milestone and possible changes in the operational process for its implementation

Development of organic product

Five milestones are recommended above to reduce the sustainability challenges in the context of Nestle. The most immediate milestone is the improvement of supply chain management to enhance the quality of the product. However, in order to improve the product quality it is crucial for a business to enhance their manufacturing process in the supply chain management (Sarkar & Panchal, 2017). Application of TQM and Six sigma tools are beneficial to improve the quality of the product by improving the supply chain management. A process diagram has been shown below to understand the six sigma process to ensure the quality.

According to the above diagram many changes need to be implemented in the supply chain operation process in the context of Nestle. Define, measure, analyze, improve and control are the major four steps of using six sigma tool. In order to define the current issue business case analysis, stakeholder analysis, risk assessment and customer information collection are crucial. These will help Nestle to identify their current problem that is the quality issue of the product. In the measurement process the operating process is measured and system is analyzed (Banawi & Bilec, 2014). Nestle needs to use process mapping to analyze the quality efficiency. Therefore, value analysis and root cause analysis should be done to understand the root of the problem. This will help nestle that poor supply chain process is the major reason of the quality issue. Root cause analysis of the problem is necessary to analyze the current issue. This can be done by the help of expert team in an organization.

After analyzing the issue it is crucial to bring improvement in the current status of the organization (McAdam et al., 2014). For this reason, development of the solution is crucial. Nestle has been facing quality issue regarding their product. Thus to reduce such issue they need to offer quality product. Introduction of the health conscious and hygienic product will be effective solution for Nestle to decrease their quality issue and to meet the need of the target customers. After development of the solution control is required. It is important to control the implemented process by conducting regular monitoring. During the monitoring process documentation of the issues that may occur in the new system is required. This will be beneficial for Nestle to reduce any issues from their new operating process. Hence, application of six sigma tool will be effective for Nestle to improve their supply chain management.

References

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