E-Commerce for Nestle
Nestle, one of the largest multi-national corporations with 200 operating companies and subsidiaries in 80 countries, has a crucial demand for a seamlessly integrated system which would foster strict regulations and control for its operations. The primary section focuses on the various supply chain management process which is required for Nestle to identify their business processes and effectively plan, execute and measure performance. It critically assesses the very viability of such process and the productive manner of utilization for the enterprise.
The secondary section entails the implementation of an E-Commerce application which would not only bring every resource at the same page but also facilitates communication among them. The final section discusses the change management principals which are utmost essential for Nestle to monitor and manage change in the organization. Supply chain management (SCM) The SCM for Nestle would manage their primary business segment and its manufacturing plants. The primary source of its raw materials for products from its various suppliers and manufacturers requires a large amount of tapping to reduce the cost of the final product.
The various integration of the businesses ensure efficient handling of the product transformation at every phase and handling all the business functions like shipment, delivery, warehousing, logistics and many others (Ballou, 2002). The primary matter of concern is to identify those operations in the entire business at the primary stage of product development requires an integrated system to manage the transfer of ownership of the product transformation and thus managing the costs involved in the process. The three processes involved in the fostering of an idea of SCM are as follows: a. Planning
The primary phase of Nestle requires a large management of the process transformation and requires bringing every external entity or better be called the stakeholders on the same page. Primarily the various business processes for delivery, distribution and management of the product sale ensures better handling of the product and their spread in the market (Aaker, 2002). The initial stages would mark the identification of the various functionalities where the product is in constant movement from one business process to another and requires an efficient handling to save time, effort and costs.
Nestle’s use of SAP for supply chain control has earmarked their entire product flow mapping and can be tracked at every point of time. The management of the product life cycle at every 200 operating companies would ensure better knowledge of the product at any given point. b. Execution The execution phase of the SCM is very critical and marks the implementation success of the entire SCM process (Harrison 2005). The very integrations made at every juncture of the product transformation process ensure better handling of the business operations of Nestle.
The execution stage also marks the binding of every business process with one another and to track the movement at every stage. Nestle’s initiative to take up SAP has fostered enough defined though process to manage their business processes and they have proven grounds of making large scale profit and have successfully cut costs at every logistic functionality (Claudio, 2006). c. Performance measurement The SCM, process model in the SAP software, process at Nestle has given large scale benefits.
Taking into account the various costs it had cut on the business logistics front has ensured better handling of the business and identification of the effective methods for optimizing business performance (Cooper, 2003). The performance analysis for Nestle is a long term affair and when such large systems like SAP is installed in place, the performance statistics show very good results. The various costs involved in effort and time spent in communication, business data transfer, decision making, reducing business operation life cycle, optimization on various resources and many more.
The results of such optimization initiate better degree of handling the business and right sense towards ownership for business resources. E-Commerce Strategy: Nestle’s operations and business spread is separated across geographical locations and deserve an E-Commerce implementation to reach out to the globe with the excellent brand it has developed. The global acceptance of the brand has brought about intense competition from every major market players in every country and exploiting the strengths of the internet and capitalizing on the weaknesses would foster better growth of the enterprise (Amoako, 2005).
The E-Commerce implementation can be strategized as follows: a. Planning The planning of the Nestle’s products to be put over the internet requires a definite plan to ensure better fetching the customer demands to display over the internet (Trepper, 2000). The customer mind needs to be fetched well which can be preliminary done using surveys and other forms of research. The primary benefits of doing so would be to better understand the customer and their preferences.
Nestle’s customer is not always the individuals but small to large scale institutions namely distributors, wholesalers and retailers who purchase in bulk to further redistribute the products. At this planning phase the business to business (B2B) model must be considered for better utilizing the internet business standards (Copacino, 2001). b. Design The design of the E-Commerce model would be in the form of a B2B website which would also feature selling options to individuals. The design would be in accordance to the various usability traits and would feature a large chunk of its products which can be availed by other business.
c. Implementation The E-Commerce system would be hosted over the internet and would be accessible by all its 200 operating companies at every point of time. The system in the form of website would be hosted at the internet server and would be marketed over the internet for its availability and reach. The data transfer regarding the products availability and supply oriented dynamics would be made possible with its mapping with the SAP system in place. The E-Commerce system would posse’s heavy duty business logic software to implement JIT ordering system linked with the SAP system of Nestle (Leymann, 2002).
The stock management system in place, another SAP function of Nestle would directly correlate with the E-Commerce system to facilitate efficient ordering process by its large chain of suppliers and distributors. Maintaining stock levels and management of the shipment of the goods would also be monitored using RFID system which also needs to implement in the E-Commerce system (Ngai, 2008). d. Operations The operations of the E-Commerce system would involve large scale ordering process and shipment details of the orders for various geographic locations over the world.
The primary advantage would be to manage efficiently the product dispatch process and its monitoring which would help all its 200 operating companies to stay synchronized with all the latest happenings with their orders. The localization and decision making regarding their business operations takes a large toll without a system in place. It brings forth human errors, often delay means losing certain lucrative business opportunities, delivery delays would erode customer confidence and irregularity in customer service for better competitive advantage.
E-Commerce implementation and operations with direct integration with SAP system in place would capitalize on the disadvantages and improve performance in the long run. Change management for Nestle: The change management process would not be too hard to implement as they already have taken a great initiative in implementing the SAP system (Hayes, 2006). The very process to curve out and implement SCM and E-Commerce with direct integrations with the ERP system would make the change management principal work really well (Hindu. com, 2008). The various points of concern would be high lightened as follows: