Effect of e-commerce companies and the industries
TABLE OF CONTENT
The report ____________________________________________ page 2
Food and Beverage Industry Background _________________ page 3-6
Company Background __________________________________ page 6-7
Context Diagram and business models ____________________ page 8-12
Discussion of E-commerce________________________________ page 12-21
Legislations____________________________________________ page 21-24
Evidence/portfolio appendices_____________________________ page 25
References_____________________________________________ page 26-27
NESTLE COMPANY
The report
The report is centering on Nestle’, being part of the food and beverage industry and will discuss about the company’s business operations and how it fits to the industry in terms of e-commerce presence and how some legislations do bring positively drive to the e-commerce adaptation of Nestle and assuming any useful and direct developments with regards to the impact, use and governing legislations of e-commerce at Nestlé. Thus, being aware of the role of e-commerce and the type of legislation that the Nestle’ company is subject to respectively. There has to be emphasis as to certain ways Nestlé brings more nutritious products to more consumers all over the world, the focus on Nestle’ values and principles for determining how Nestle’ cares for the e-commerce fact of the business from its business structure, to business principles and leadership dealing to industry success and empowerment over other companies with the same nature.
Food and Beverage Industry Background
Food and beverage in the context of Nestle’ do utilize simple words to describe what the company believe in and what they are offering to the consumers around the world, the slogan about ‘Good Food, Good Life’ is known from every business points beyond Nestle. Recognizing that ffood and beverages play an increasingly important role in people’s lives and not just only because of the enjoyment and social pleasure of eating together, but more and more in terms of personal health and nutrition. Indeed, nutrition is only one aspect of “Good Food, Good Life“, consistent quality and safety, as well as value for money and convenience, and producing great taste is fundamental to Nestle’ products and the company’s consumers‘ appreciation of good food. There can be roles and nutrition labels across different sectors of the industry such as the restaurateur that assumes the process of creative and marketing elements, an e-commerce. The better notion of food and beverage is the fact that standards and regulations for business are of strong fold. The industry in focus will be Nestle’ being known as one of the best food and beverage company of today’s time. The e-commerce of Nestle’ has means for group establishment dimension, which is of crucial stance into the food and beverage business (Riley, 1981). Ideally, Nestle’ are being considered to be in high performing operations of e-commerce, sought to improve food and beverage facilities and operations agreeing that, such management provision of food and beverages can denote valuable and integral part of hospitality products and the complexities of relationship between other business partners as can flowed in terms of issues such as organization culture and operational tension so that the impact pointing towards consumer perception will be applied and executed within Nestle’ ways of business operations. E-commerce management can contribute to business performance at certain levels including food and beverage service received by the customers, as the operation of Nestle’ in a way assumes effective provision of commercial hospitality and produces a shared concern within Nestle’ trade cycle for e-commerce success and adaptability.
Though the food and beverage industry has been somewhat neglected, the identification of whether it is “new” or “old” innovators who introduce new technology among food firms has significant consequences as the product and process innovations can contribute to Nestlé’s deterring entry, though the competitive effects of each type of innovation are probably different as e-commerce and Innovation strategy plays a substantial role in competition among food and beverage firms (Galizzi and Venturini, 1996; Christensen et al, 1996). The proliferation of brands, a widespread phenomenon in this industry, is likely to discourage entry or mobility and could leave no viable ecological niches for new entrants, as Nestle’ technical innovation and new ways of packaging products may help also Nestle company to launch more good brands adding contribution to explaining business competition, analyses of patterns of technological accumulation in the food and beverage industries may help toward a better understanding of incremental technological change, which is considered a characteristic of the Nestle industry (Galizzi and Venturini, 1996; Christensen et al, 1996). Thus, food and beverage industry can be considered a low-tech industry, as profitability and growth seem to depend on the Nestlé’s ability to innovate precisely even in minor and unpatented improvements may have positive effect on performance in the business industry. Aside, every alternative would obviously bring in a different pattern of technological change among food and beverage business, at Nestlé long time-series of innovations may provide better predictions of technological change in the e-commerce operations, as such role is not always into good predictor of future business value and stance. In the food and beverage industry, Nestle business and e-commerce functioning do demonstrate good technological performance ideally into the nutrition paradigm, keeping in good corporate governance for e-commerce legislation realization and execution. The context diagram (as discussed later) will be about the process wherein Nestle implies to their core responsibilities in such research and development down to the critical ways to achieve good health and business and how business of Nestle’ move from strong yet desirable grounds of globalization from within consumers patronizing products and what the shareholders have to do with the e-commerce adaptation process as there might have past e-commerce role modified and provide empowerment and influence over business key players and the understanding of Nestle’ ways at the technology level along with the given importance of Nestle and other companies in food and beverages production and e-commerce technology, as the industry will assert to the functional analysis that could contribute to the promotion of more accurate Research and Development (R&D) policies from within Nestle’ organization values and performance from within food and beverage sector.
Company Background
Nestlé is the largest food and beverage company in the world. It is also well on its way to becoming world leader in nutrition, health and wellness. Nestlé is more than just the largest food and beverage company in the world. Increasingly, Nestlé is becoming the world’s leader in nutrition, health and wellness. From the start, nutrition has been at the core of Nestlé business. However, today the company place far greater emphasis on it – and on health and wellness. The Corporate Wellness Unit and the individual business units are driving forces in bringing Good Food, Good Life to all Nestle consumers. The task Nestle Research & Development (R&D) to apply nutritional science and expertise to create products that combine great taste with nutritional benefits. Thus, Nestle firmly believe that their research can make better food so that more and more people live a better life.
Through continuous innovation of new products and renovation of existing products, Nestlé is creating and enhancing hundreds of Nestlé products, especially in terms of their nutritional benefits. Nutrition has always been at the core of Nestle business being founded, back in 1866, on the launch of an innovative, nutritious baby food. As of the present, as it may be almost many years had gone by, the company live into such diverse e-commerce world and the standards of living standards have improved and people life styles have changed which have had a considerable influence on Nestlé – because of the products Nestle make and the way Nestlé embrace and use their business strength and e-commerce opportunities. Nestlé today is at the forefront of providing consumers with food and beverage solutions that generate a long, healthy life.
Context Diagram and business models
Ideally, Nestle have reorganized our FoodServices business, focused on the out-of-home consumer, under the Nestlé Professional banner and have given it a new globally managed structure that provides it with greater focus, drive and effectiveness. One of Nestlé Professional’s core competences is offering its customers added-value services, and this is an increasingly important area also for direct to consumer businesses such as Nespresso, Jenny Craig and Nestlé Nutrition Home Care. These initiatives, together with Nestlé’s pre-eminence in the field of Nutrition, will ensure that Nestlé will not simply match the growth opportunity of demographics such as growing populations, increasing wealth and longer lives, but that it will clearly outpace that growth. But the Nestlé Model is not just about growth; it is about sustainable profit table growth. Nestlé has made strides in improving its profi tability over recent years, but remains rich with potential: some lies in the opportunities already mentioned, some within our structure. The changing organization, increasingly characterized by agile teams in each country, focused on their customers and consumers, understanding their local dynamics and able to move rapidly, seeks to realize that potential. These teams are supported by highly effi cient manufacturing operations, as well as regional or global support structures for non core competence services. This means that the teams in the markets have more time to focus on their customers, consumers, products and brands. GLOBE – Global Business Excellence as well as GNBS – Global Nestlé Business Services are at the core of Nestle transformation.
Nestlé continue to believe that their greatest opportunity to create value for their shareholders is through further transforming their Food and Beverages business into a Nutrition, Health and Wellness offering and by improving its performance further. Nestlé believe that they have the right strategy and initiatives in place to achieve this. This is not to say, however, that we are not looking for other opportunities for value creation. One good driver of shareholder value creation is Corporate Governance. The Nestlé Model is not just about key players growth but can be about sustainable profitable growth. Nestlé has made strides in improving its profitability over recent years, but remains rich with potential. Nestlé continue to believe that the greatest opportunity to create value for their shareholders is through further transforming Nestlé Food and Beverages business into Nutrition, Health and Wellness offering and by improving its performance further. Nestlé believe they have the right strategy and initiatives in place to achieve this. One example is Nestlé’s “Branded Active Benefits“ (BABs). The objective of a BAB is to add a specific health benefit to an existing product in a way that is meaningful and relevant to the consumer. In this way, the nutritional content of the product is enhanced so that consumers can enjoy even more health benefits as for example, improving digestive health and contributing to healthy physical growth. The presence of e-commerce at Nestlé then, plays an important role in creating products that have a proven taste advantage plus a specific nutritional advantage over competitors’ products. There will be global system of rigorous product testing including scientific nutritional assessment. Each product has measurable nutritional value to prove its superiority in delivering nutritional benefits the company’s packs are a highly efficient communication medium to provide the consumers with nutritional information. Nestlé is well-known for its wide range of everyday brands such as Nescafé and Maggi and its confectionery, ice cream and bottled water brands. Nestlé Nutrition develops science-based nutrition products and services that enhance the quality of life for people with specific nutritional needs. With its focus on core nutrition, it is closer to pharmaceuticals than mainstream Nestlé food and beverage products. While taste is important, the key driver for Nestlé Nutrition‘s more specialist products is to provide appropriate nutrition to address specific problems at all stages of life.
Discussion of Ecommerce
Upon determining success and effectiveness of e-commerce players as utilized by Nestlé such factors of e-commerce will have to go positively to innovate properly within the e-commerce process. The development of economic systems is affected by enterprises’ ability to carry out innovative actions, in order to take opportunities and escape threats characterizing the business and technological environment in which they operate. Thus, in a situation where there may be business performance issues and globalization, competitive challenge involves technological, organizational as well as environmental areas that can be in extent to B2B and B2C and other points will hand in Nestlé e-commerce penetration level of innovation process and attention will have to focus on realizing business players and partnerships with potential innovation ways. Moreover, such models relating to e-commerce integration will be relevant for Nestlé success over the years, the context diagram thus assume technology transfer from within potential involved – e-commerce players – actors of Nestlé e-commerce and the consumers willing to realize the role of ecommerce at Nestlé through effective business process in carrying out innovation audits as well as execute better B2B to B2C for Nestlé governance which are according to the needed resources and competences reflected through e-commerce dominance. Electronic commerce is the process of buying and selling goods and services electronically through computerized business transactions using the Internet, networks, and other digital technologies (Lauden and Lauden, 2000). It has been argued that enterprises are adopting electronic commerce not as the product of a reasoned strategy but are being driven by competitive pressures and enthusiastic media hype (McBride, 1997). However, there significant organization benefits to be gained from adopting electronic commerce, despite number of benefits to be gained from the technology, based on the users’ perspective, Nestlé adopt technology according to their self-assessments of how the innovative technologies will change bottom line profitability (Fuller, 1993) and if the bottom line is not improved by the implementation of electronic commerce then the technology will not be pursued as a business critical element.
Furthermore, Kandelin et al. (1998) have identified core organizational issues, which are deemed paramount for the successful implementation of e-commerce technology such as electronic commerce. These are participation, top management support and training. From the perspective of this research, training is the most important of these elements, whereby training is defined as planned and systematic effort to modify or develop knowledge, skills and attitudes through learning experiences, to achieve effective performance in an activity or range of activities (Garavan et al., 1997). Nestlé will need an active climate of trust and redress to engage in B2B globally and or B2C commerce at national and international levels as Nestlé processes will make it easier to transact B2B commerce from within appearing through food and beverage sector networks. For e-commerce readiness, the food and beverage sector, Nestlé in particular should support e-transactions among its players and other business partnerships with Nestlé governance and leadership utilizing wide range of information and communication technologies.
Henceforth, one of useful mechanisms for transferring knowledge and innovation to Nestlé business sector is through market distribution channels such as shopping mall, retail centers and networks. These provide Nestlé with pertinent e-commerce values and skills at ample costs for Nestlé development centers and other useful services does increasing the rate of e-commerce role towards in-depth research and development through business nature and all. Aside, Nestlé customers is expected to purchase requirements and perform home delivery function; therefore, distribution models in place were focused on bulk deliveries to regional distribution centers and spoke and hub distribution to the retailers. However, with the advent of disintermediation, the retailer is expected to perform the whole delivery chain, hence the flourishing of the small parcel delivery industry. Issues from the provision of B2B service are noticeably different from encountered when providing B2C service and there have indicated that B2B, B2C and others represent good standing of Nestlé forming good business channel assumptions. Thus, B2C represents the public face of e-commerce and represents the majority of the current growth with venture capitalists spawning multitude of dot-com businesses.
Then, if Nestlé e-commerce is to be perceived as success within the same area as B2B, B2C incorporates e-commerce business model process as B2C is difficult mode to get right, it does not necessarily mean that it is difficult to be successful within B2C will be higher than B2B, but the prevalence of critical processes does demonstrate that consumers now expect certain minimum level of performance when purchasing services. The fickleness of consumers, coupled with the ease that e-commerce provides in contrasting prices and value added services, requires that B2C sites must work hard to exceed customer expectations. To succeed in B2C an organization not only needs good products and marketing, it needs excellence within its processes, with culture of continuous improvement and excellence. The most important process for B2C is logistics and cash flow and channel harmonization in order fulfillment. It is to no avail to get the front-facing aspects of web presence right, only to let down the credibility of the whole organization by not providing the services when promised. It is considered that Nestlé will be doing well in food and beverage industry which have leadership qualities in manufacturing and bringing right nutrition to the society and to the world.
Business models are defined in terms of the services offered, including, .new marketing, promotion, advertising, sales and distribution channels, and new loyalty policies (Mallah, 2003 in Timmers, 1999). Business industries seeking venture capital may define their business models in terms of key resources such as core capabilities; technology portfolio and management team. Many people and companies are not aware of the developments and the role they could play in this new marketplace. The information provided is often too technology oriented and does not address their business priorities. This information confuses more than it educates, and complicates decision-making. There is perception that business partners face similar organizational and technological problems; hence, their lack of readiness is seen as barrier (Mallah, 2003 in CommerceNet, 2000). Furthermore, electronic commerce helps Nestlé achieve productivity goals through seamless integration of processes and efficient interfaces. Similarly, technology professionals need to learn available technology options, and the best available course of action for their enterprise (Mallah, 2003 in Nadeem & Al-Qahtani, 2002).
Thus, the lack of knowledge of ongoing developments into the rapidly changing e-commerce valuation within Nestlé business processes required to deliver an adequate level of service quality through the use of effective platform and important ways to deliver quality services and products to people as food and beverage sectors do facilitate the adoption of Nestlé e-commerce ways by business growth and stability. Nestlé can measure innovation capacity in terms of macro-scale output, investments, partnerships and organizational restructuring as macro-scale output measures typically include number of new products, services, companies, methods, and practices. Patents are important measurements in a knowledge economy where business worth is based on the intellectual property owned. Also, Nestlé business metrics less prevalent due to measurement problems include sales concepts and logistics systems that represent e-commerce partnerships and Nestlé competence, R&D and business alliance metrics as be of use for measuring the degree of successful partnering for stability and leadership into the globalize market.
There is theoretical model for e-commerce assimilation needs to consider factors that influence the propensity to adopt and use the innovation, which is rooted in the specific technological, organizational, and environmental contexts of Nestlé as the OTE structure (Tornatzky and Fleischer 1990) is appropriate to study contextual factors that influence e-commerce assimilation. The framework identifies three aspects of business context that influence its assimilation of technological innovation: (a) Technological context describes both the existing technologies in use and new technologies relevant to the firm. (b) Organizational context refers to descriptive measures about the organization such as scope, size and managerial structure. (c) Environmental context is the arena in which firm conducts its business as industry, competitors and dealings with government (Tornatzky and Fleischer 1990, pp. 152-154).
Nestlé, which is a world leader in the food beverage industry, are to set up modified market place for e-commerce in the consumer goods sector. As there will enhance the efficiency of logistics while at the same time reducing procurement costs for businesses producing, distributing and selling consumer goods and that service will be based on mySAP.com e-commerce platform. To produce unique electronic platform for purchasing and supply chain management at Nestle’ and have online access to business and information. The unique initiative will cut supply costs through automated processing of orders and sales. Buyers and suppliers will be able to place orders on catalogue offers, call for bids and participate in auctions. They will also have access to sourcing services for raw materials and packaging, as well as capital goods and services. Participants will benefit from a more efficient market and lower costs through higher transaction efficiency and simplified procedures. Open and cooperative, Nestle’ market will be using e-commerce solutions offering mySAP.com for example. The Nestle’ company is dependent on consumer choosing Nestlé products in preference to their competitors’ products as wholeheartedly dedicated to the consumer and focused on meeting ample business needs. For success and growth, Nestle’ have to build the greatest possible consumer trust in both the Company and its products. One way is to get as close to the consumer as possible. The aim is to achieve better consumer understanding than Nestle’ competitors from product concept to the writing on the pack. Nestle’ have to assure the highest possible standards all along the supply chain from raw materials via manufacturing, packaging and distribution, to the point of consumption. People can buy Nestlé products in schools, offices, hotels and airports. In ice-cream parlors and fast food outlets. On planes, trains and boats. In veterinary practices, service stations and fitness centers. Nestlé’s reputation over many years for consistent quality and safety has earned the respect of consumers all over the world.
Legislations
The Nestlé Corporate Business Principles and the Nestlé Management and Leadership Principles lay down principles that permeate the whole Nestlé Group. They govern our policies and strategies. They set the tone and style for our approach. They affect everyone who works at Nestlé. They also impact everyone with whom we do business. In effect, they form ‘a code of conduct’ which is lived out by each one of us at Nestlé. The Nestlé Corporate Business Principles outline the Nestlé way of doing business. They include sections on Infant Health and Nutrition, Human Rights, Child Labor and the Protection of the Environment, as well as a set of Consumer Communication Principles. They include all ten principles of the United Nations Global Compact, as well as the International WHO Code of Marketing of Breast-milk substitutes. The Nestlé Corporate Business Principles have been translated into more than 40 languages and distributed to their management around the world. E-commerce zones than are to built in certain key beliefs that include: Nestlé’s business objective is to manufacture and market its products in a way that creates value that can be sustained over the long term for shareholders, employees, consumers, business partners and the national economies in which Nestlé operates. Nestlé does not favor short-term profit at the expense of successful long-term business development. Nestlé recognizes that its consumers have a sincere and legitimate interest in the behavior, beliefs and actions of the Company behind the brands in which they place their trust. The Nestlé Management and Leadership Principles are based on the many experiences that have led to the company’s success throughout its long history. They relate mainly to the human aspects of our management and our employees, and stress the multi-cultural nature of the Company. Nestlé embraces cultural and social diversity and does not discriminate on the basis of origin, nationality, religion, race, gender or age. Nor does Nestlé have any political involvement. Nestlé operates in many countries and in many cultures throughout the world. This rich diversity is an invaluable source for our leadership, and also for broadening Nestle’employees’ experiences. A key theme of the Management and Leadership Principles is that the company put interim priority on people rather than systems. This results in a structure that is as flat as possible, rather than hierarchical, and gives individuals plenty of opportunities to advance their careers. Together with Nestlé’s Corporate Business Principles, the Management and Leadership Principles form the foundation of our approach to doing business. It’s an approach that has been recognized by top academics as having generated real benefits both for Nestlé and for society like for instance, the studies and works of Michael Porter and Mark Kramer have stated that they have puts Nestlé in the front rank of companies who create real shared value for themselves and society at every step of their business process and e-commerce success from within the value chain process. As Porter and Kramer argue that the Nestle’ business approach has already stood the test of time; and will continue to do so precisely because there are winners on all sides. Then, Nestlé Company has aimed to build a business as the world’s leading nutrition, health and wellness company based on sound human values and principles.
In a full range of e-commerce governance and regulation the following points explains the process as Nestle’ will continue to evolve and adapt to a changing world, our basic foundation is unchanged from the time of the origins of our Company, and reflects the basic ideas of fairness, honesty, and a general concern for people. Nestlé is committed to the following Business Principles in all countries, taking into account local legislation, cultural and religious practices (source: http://www.nestle.com/AllAbout/AllAboutNestle.htm)
Nestlé’s business objective is to manufacture and market the Company’s products in such a way as to create value that can be sustained over the long term for shareholders, employees, consumers, and business partners. Nestlé does not favor short-term profit at the expense of successful long-term business development.
Nestlé recognizes that its consumers have a sincere and legitimate interest in the behavior, beliefs and actions of the Company behind brands in which they place their trust, and that without its consumers the Company would not exist. Nestlé believes that, as a general rule, legislation is the most effective safeguard of responsible conduct, although in certain areas, additional guidance to staff in the form of voluntary business principles is beneficial in order to ensure that the highest standards are met throughout the organization. Nestlé is conscious of the fact that the success of a corporation is a reflection of the professionalism, conduct and the responsible attitude of its management and employees. Therefore recruitment of the right people and ongoing training and development are crucial. Nestlé continues to maintain its commitment to follow and respect all applicable local laws in each of its markets.
Therefore, Nestlé’s success is based firmly on the concept that “food is a local matter“. Although the products are available in virtually every corner of the world, we don’t believe in a standard worldwide taste. On the contrary, Nestle’ go to considerable lengths to adapt our products to local consumers’ tastes. These can vary widely, different cultures, different geographies, different needs, tastes, flavors and habits all influence what Nestle’ consumers eat and drink. So it’s vital that Nestle’ to utilize and apply e-commerce knowledge and ideal business experience.
Evidence/portfolio appendices
For detailed information of Nestle’ and how discussions formed and led into understanding and awareness of such e-commerce factors and domains put into information, the following resources paved the way for research report evidence pertaining to the process of Nestle’ business, operations and the degree of e-commerce the company is involved into.
Nestle official site
About Nestle
http://www.nestle.com/AllAbout/AllAboutNestle.htm
Code of Business Conduct
http://www.nestle.com/Resource.axd?Id=91079B30-575B-4DCA-A3F6-566FD5C67683
The World of Nestle
http://www.nestle.com/Resource.axd?Id=602C42FE-04D6-4669-BEE1-1027492FE5E8
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