How the structure of an organisation is arranged depends on the company´s strategy and objectives. Organisational structure has a hierarchical nature. It is the specification of lines of authority and main tasks of an organization and it´s subjects. The structure provides an information about the main responsibilities and roles assigned to the particular elements of the organisation. (Organizational structure, n.d., “Definition” section, para 1- 2)
Chairman Peter Brabeck-Letmathe, who formerly held the function of Nestlé chief executive officer (CEO), leads the Board of Directors which is the governing body of the organisation. The Board consists of 14 members. (About us, n.d., “Management” ...view middle of the document...
8). Decision-making authority does not solely rest with the top central figures, but is delegated to the lower level management. These managers not only give a share in the development of the organisation, but are also able to make certain important decisions, due to the complex external environment of the organisation (Nestlé organisation, n.d., “Structure” section, para 1). Effort to establish broad spans of control with flat structure is one of the main principles of the company (Paul Bulcke, 2011, The Nestlé Management and Leadership Principles, “A decentralised and aligned organisation” section, p. 8, para 5).
Nestlé is organized around the geographic zones. The main reason is that consumers´ requirements and marketing strategies vary worldwide. Therefore, Nestlé can be classified as having geographic divisional structure (Steven L. McShane and Mary Ann Von Glinow (2012), Forms of Departmentalization “Divisional Structure” section, para 3). The effort of the company to balance geography with products also describes Nestlé as having alternatives of a matrix structure. In this case both elements, location and products are equally important (Steven L. McShane and Mary Ann Von Glinow (2012), Forms of Departmentalization “Matrix Structure” section, para 3-4).
In Creating Shared Value, effective communication of the Nestlé organisation with its stakeholders is essential. The company developed stakeholder engagement programme in order to make cooperation and collective actions more efficient. (Stakeholder engagement, n.d., para 1). The company identifies its stakeholders at the national and international level. The later one is co-ordinated centrally. (Stakeholder engagement, n.d., “Our approach” section, para 1)
The network of company´s stakeholders concerns groups or individuals whose public post influences the organisation´s operations, and those who have direct share in the Nestlé business activities. Key external stakeholder figures include suppliers, governments, consumers, intergovernmental and nongovernmental organisations, and communities (Stakeholder engagement, n.d., “Key external stakeholder groups” section, para 1-3). Among internal stakeholders we can identify managers, employees and owners/shareholders.
Suppliers are essential contribution to the company's production and therefore delivering customer value. They are the providers of goods, services and equipment, especially over a long period of a time, necessary for the Nestlé operations. To adhere with the international standards, organisation created the Nestlé Supplier code that formulates non-negotiable principles when conducting cooperation with Nestlé (The Nestlé Supplier Code, December 2013, “Introduction to the Nestlé Supplier Code” section, page 1). Suppliers have an interest in a wellbeing of the company, so the Nestlé will remain their customer in a future. The government’s role is to ensure that the company will provide jobs for people and pay taxes. ...