TOTAL QUALITY MANAGEMENTProject -3

Creating Shared Value in the supply chain-Nestle

Group MembersMir Sarmad Khero

Bilal Ahmed Memon Prem Chand

INTRODUCTION Nestlé promise of quality, taste, nutrition and

convenience. Today, Nestlé is the world's largest Food and

Beverages Company, and a global leader in health, nutrition and wellness.

The headquartered in Vevey, Switzerland. Today Nestle have 461 factories dotted around

the globe, employing over 330,000 people in 83 countries. in 2013 its global sales reached up to CHF 92 billion.

Joint venture Nestle and Milkpak Ltd. in 1988MISSION STATEMENT

“Nestlé’s mission is to provide the best food to people throughout the world.”

The case study demonstrates how nestle is creating shared value by improving the standard of living of its primary goods suppliers (cocoa farmers) and creating a collaborative environment which in turns helps it build healthy long term partnership with external stakeholders (suppliers,customers and communities).

Nestle Cocoa Supply Chain

BUILDING PARTERSHIPS

Results These efforts show the benefits of corporate

social responsibility and shared value for the company and its internal, external stakeholders.

The long term relationships with suppliers have improved the quality and output of cocoa and have supported the local communities as well.

ANALYSISThe case depicts the proactive approach of nestle

for sustaining the quality and required quantity of its raw material (cocoa) for the future.

Nestle predicted that the workforce of producing cocoa is getting older and the younger generation is losing interest in the homeland because of lack of employment opportunities .

What nestle did, it initiated its CSR program ( the cocoa plan) to built healthy relationships with its stakeholders and thinking for the betterment of the supplier and the community.

BENEFITSThe investment in plant research helped in producing

higher yield for the product, helping the company to fulfill its requirements and the farmers to sustain higher income

Training to farmers helped the incoming stock to be of high quality and for farmers it produced more income

Improving social conditions e.g building schools helped to keep the upcoming workforce in town

The fair trade labels helped with the compliance of international laws and for those certifications the farmers were paid a premium for their production.

ANALYSIS CONCLUSION..The outcome of the program, a healthy long-term relationship with the stake holders benefited the company as well as the well being of the suppliers and the society.

It built positive image of nestle in the communities and kept the company in business for future.

Tools and technique of TQM apply in this case

“Nestlé has a series of corporate business principles” it is Reflects the S.O.Ps of the company.Quality culture, that emphasis on the customer oriented, proactive approach, for long term decision making, believe in prevention rather than cure (win-win).CSR, evidence the Process improvement that includes a safer manufacturing process, providing the quality to its stake holders.The communication with the stack-holders, feedbacks (complains and suggestions) as opportunity to continuous improvement. Supply Chain partnership, nestle follows Ishikawa’s fourteen i.e. Long term commitment, Trust , Shared vision , Joint performance of business activity and Win-win situationTreat suppliers as their partners

ConclusionCreating shared value is wider, long term and proactive approach.

It has enabled Nestle to support local communities as well as improving both quality and output of cocoa.

Nestle provides training to farmers to encourage desirable production, protect the supply chain and quality of raw material for long term.

Practices promote the confidence and positive image of all stakeholders related to industry

Win-win situation !!!

Recommendation Flexible working condition for formers.

Keep the effort boost up the stakeholder’s confidence.

Increase former’s loyalty due to effective training and shared value

Increase supplier network among different agricultural

country to avoid future risk.