Unilever Business Project
Unilever is a company that operates all over the world.They produce a wide range of products, concerning all sorts of food, detergents and etc.For a large company like Unilever to be successful, they have to implement a certain strategy and to have vision and mission.
For this assignment we are focusing on the UK market. The brand we chose is Carte D’or. To start with the overall vision of Unilever. They are looking at developing new ways of doing business for the future, to increase the benefits for the company, as well as to reduce their environmental impact on the nature by Unilever`s activities.
Their mission, is to make their business more sustainable. For example, Unilever`s plan has over fifty targets to achieve. Most of them are focused on helping people to improve their well-being and health, reduce the pollution of their products and source the agricultural raw materials sustainably. Sustainability and fair trade are Unilever`s main goals, which are influencing the whole corporation. Regarding the changing weather conditions and scarcity of usable agricultural supply. Unilever introduced a Sustainable Living Plan, that will enable them to source only sustainable materials.
According to Unilever, it is also of vital importance to have the suitable people with the right talent, skills, creativity and education to support the growth of the enterprise. As part of the `Sustainable Living Plan`, the company is looking at healthy and motivated workforces, which would provide them with the right employees. In order to make this plan become reality, they are arranging better work places, which means reducing work injuries, industrial accidents and provide variety of stimulus’s. Nowadays, Unilever is struggling to create shared values with its customers to provide stability and growth.
Companies can meet social needs while at the same time serving existing markets, accessing new markets and lowering costs through innovation. Unilever has chosen the path of innovations, as well as improving quality, quantity, cost, and reliability of inputs and distribution. While at the same time the company is acting as a steward for essential natural resources and drive economic and social development. As stated above, their mission is: “We work to create a better future every day. We help people feel good, look good and get more out of life with brands and services that are good for them and good for others.
We will inspire people to take small, everyday actions that can add up to a big difference for the world. We will develop new ways of doing business with the aim of doubling the size of our company while reducing our environmental impact. ” (source: http://www. sustainable-living. unilever. com/news-resources/news/inspiring-sustainable-living/) The above comes back again in Unilever’s report. For instance, their ambition is to double the size of the company while reducing the environmental footprint.
Furthermore, they have a sustainable living plan; Unilever wants to grow without damaging the environment and increase the social benefits arising from Unilever’s activities. This plan has been set in 2010 and has 3 major outcomes, as can be read on page 20 of Unilever’s annual report of 2010: * Helping more than a billion people improve their health; * Halve the environmental impact of the production and use of Unilever’s products; * Enhance the livelihood of people in their supply chain. A good example is COMFORT ONE Rinse fabric conditioner. Many customers in developing countries do their laundry by hand.
COMFORT ONE needs only one bucket of water for rinsing instead of three. In this way, consumers save time and money. The reason why Unilever is performing this plan, can be summed up in a few points: * More and more consumers want products that are sustainably sourced; * Retailers have their own goals for sustainability and Unilever can work with them; * New products and packaging can be developed as part of the sustainability plan; * Half of Unilever’s sales take place in developing countries, so these countries represent a huge future market for the company.
These countries face the greatest sustainability challenges; * Managing sustainability saves money for Unilever and the consumer. Below we will show Unilever`s structure on both Multinational and Business level. Multinational Level: Source (http://www. theofficialboard. com/org-chart/unilever-1) Business Level: Source: http://www. theofficialboard. com/org-chart/unilever-ventures) In order to explain the process of creating values when making ice-cream, we are going to use Porter`s value adding chain to support the explanation. PRIMARY PROCESSES:
SUPPORTING PROCESSES: ————————————————- Primary processes Inbound logistics: Carte D`Or buy ingredients for the ice-cream production from a variety of suppliers. In order to improve its efficiency the exclusive brand can start performing business procurement. In this way Carte D`or can use purchasing function to reduce its costs and improve their long-term strategic planning techniques to deal with the outgoing costs. Using strategic purchasing would enable them to negotiate for the supply of milk, sugar, cream and ect.
In this way the procurement approach would increase the CM (contribution margin). Processing: The processing stage would start with the fulfilment of the ordered ingredients in the procurement department. Later on all the ingredients are get together into the assembly process. The Carte D`Or`s recipe is prepared and the ice-cream is prepared. In this press, Carte D`Or can take an advantage by integrating the JIT method. This would help them always have fresh ingredients and not going to keep too ingredients inventory.
This can be implemented by ordering smaller quantities of ingredients and increasing the supply frequency. Outbound logistics: In this process of Carte D`Or brand is concerned with the storage of the made ice-cream. The ice-cream package is quite important for keeping the product fresh, protect it during storing, warehousing, transporting as well as to protect the environment form the ice-cream package from the ice-cream package that would be used. So, sustainable packaging would be a major factor in the outbound logistics of the Carte D`Or brand.
Packages, which are more eco-friendly and recyclable can take place as well as packs with improved durability.The durability factor can reduce waste, of cracked or broken packs. Marketing ;Sales: Creating a good image for the product might be of vital importance for brand. As, Carte D`Or are producing luxurious ice-cream with a premium quality they need to bind their brand and customers. Carte D`Or would add value to their products by detailed research and development, using Customer Relationship Management.
Collaborating closely with the CRM department would give the information about customers’ needs, wishes, expectations and even tendencies. Due to the usage of this technique the Carte D`Or brand set their customers as a starting point for all their products development and concepts. Services: ————————————————- The Carte D`Or brand provides their customers with a range of services, as: customer care, direct ordering of bigger quantities, B2B and B2C SCM. In addition to that the brand adds value, by applying the differentiation approach.
They provide to their customers special fan website, with the full range of products and a TV show with one of the top chiefs in the world. What is more there is a special line for problem solving callings to Carte D`Or cusromer service. ————————————————- Supporting processes: Infrastructure: Carte D`Or brand adds value with an efficient assembly line, which gives a high production level during the whole manufacturing process. Production safety and durability is another aspect that may put emphasis on preventing waste.
HRM: Carte D`Or brand is quite focused at the sort of working force they use, because they are promoting exclusive ice-cream with top quality. They put emphasis on employees suitable skills, efficiency and job enrichment, in order to stimulate the working force. Technological development: An approach thag Carte D`Or adds value in this sector of value chain would be leverage, as maximizing production and effectiveness without any investments increase. Their top goals are effectiveness and efficiency due to decreasing the expenditures and increase profit.
Procurement: Procurement in is very important for Carte D`Or brand because this Is a sector where huge expenditures can be significantly reduced. Negotiating for raw materials, auxiliary materials and etc. Carte D`Or has a special customer call centre for questions regarding procurement. Relevant systems that facilitate the primary processes in the value chain: ERP(Enterprise Resource Planning) is a relevant system in the primary processes in the value chain, because ERP is developed to facilitate the flow of information between all business functions.
It will optimize the communication and information flow between inbound logistics, operations, outbound logistics, marketing ; sales and service CRM is also relevant because it is designed for managing customer service, marketing and operations. MIS stands for Management Information Systems. This system provides the management with the right information to manage an organization effectively ; efficiently. The system analyzes the primary processes with the goal to optimize them. Why would a company adapt their packaging of ice cream? For a company like Uniliver that wants to be more sustainable, a reason can e to produce a environmental friendly packages. To comply with that, the packages have to be adopted according to the new standards: reduced waste, being recyclable and re-usable. Other reasons can be to optimize the space available, lower costs or get the attention of customers with new and improved packaging. There are multiple departments involved when changing a packaging like the Research ; Development department to design this new packaging. But also the marketing department; is involved to do the promotion and management finally makes the decisions.
Changes in packaging automatically lead to changes in the value chain. Because machines have to be re-programmed, marketing ; sales have to use a different promotion strategies (introduction of the product). But also inbound and outbound logistics will change. New materials will be imported so new routes have to be created. Also the company will have to examine which type of transportation is the most efficient in the new situation. It will make a huge difference if a package is round or square if you consider transport and storing.
Also customer behaviour will change, if a customer recognize a problem he or she will go to different phases before actually purchasing a product. First they search for information; a new package can have an influence on commercial sources. Also the selective perception process will be influenced because the perception on the promotion message will change and this can lead to a different interpretation. Perhaps the evaluation will also change because consumers feel that the products offers more benefits. If the new package requires new materials the suppliers will be examined if they are capable to deliver these new materials.
If not they need to look for other suppliers. The stakeholders and NGOs can be a threat to the company for example the new package is less environmental friendly than it might happen that they do not longer want to invest in de company. Unilever should pursue a Research ; Development policy that focuses on sustainability. They can do this by using recycled plastic for the packages and recycled paper within their offices. Use biological milk and fair trade ingredients such as chocolate. They can also make use of green energy and transport as environmental friendly as possible.
The Research ; Development department has the most influence on the structure. As we have seen the entire value chain will be affected with a change in for example the packaging. The method that we used to come to a package innovation was idea capture internally because of the limited time and resources. But there are other methods appropriate for Unilever like customer focus groups for problem detection while pre-testing to prevent future failure, external idea contest to get to know the customers wants and needs. Last consult partners and vendors to make sure that everyone is reading from the same page.
Process descriptions As shown below, there are a number of steps taken in the process of creating ice cream. (source: http://www. foodsci. uoguelph. ca/dairyedu/icmanu. html) When there’s a new product packaging, there will be a small change in the primary process. First of all, when ice cream is stored it is done so in temperatures below -18 Celsius; so the packaging has to be able to withstand such a temperature. This is important for two reasons: * The prevention of growth of micro-organisms; * Maintaining the texture of the product. When using new kind of packaging, the process can be changed.
For instance, if the new kind of packaging can withstand a temperature of below -18 Celcius, packaging can be done before storing the ice cream in the freezer and thus saving plastics, waxed paper or cardboard containers since these are used as temporary packaging. There are many activities involved when producing ice cream. Blending, aging, pasteurization etc. Below we will present which activities are involved when producing ice cream. To do so, we used a RASCI-Matrix, a process chart for sustainable activities (the green one) and finally a department-transcending table. RASCI-Matrix:
Column1| Column2| Column3| Column4| Column5| Column6| Task /Role| CEO| Financial Director| Logistics Manager| Marketing ; Sales manager| Process Manager| Support employees| Strategic Planning| Accountable| Informed| Informed| Informed| Informed| Informed| Financial Planning| Responsible| Accountable| Informed| | | | Buying ingredients| Responsible| Consulted| Accountable| | Responsible| | Marketing ; Sales| Responsible| Consulted| Informed| Accountable| | | Warehousing| Responsible| | Accountable| | | Responsible| Transport| Responsible| | Accountable| | | Responsible| Storage| Responsible| | Accountable| | | Responsible| Services| Responsible| | Consulted| Responsible| | Responsible| Supporting services| Responsible| | Consulted| Responsible| | Responsible| Analyzing results| Responsible| Accountable| Informed| Informed| Informed| | Maintenance| Responsible| | | | | Responsible| R ; D| Responsible| Informed| Consulted| Consulted| | |
The above RASCI-Matrix show the different roles and tasks. The purpose of this matrix is to show the relationship between the actors and their responsibilities. The abbreviation RASCI stands for: R=responsible, A=accountable=support, C=consulted, and I=informed. Flow-Chart ; Transcending-department table: Above we have shown the whole production process of Carte D’or ice cream. Starting with blending of the ingredients and ending with the packaging. During this process value is constantly added. Package: after the freezing procedure the ice-cream is placed into its package. This is the step where a company would be able to take a competitive advantage over its rivals.
It can be done in a variety of different ways: In particularly for Catre D`Or there might be: Package size: turn into a production a variety of smaller packages, which are relatively more suitable for daily usage: The shape of the package may play a major role: for example the company can safe cost if they use square or rectangular form of the package. In this way they may improve efficiency of logistics as more packs would be able to place into a box. In this way efficiency and sustainability would be improved as more packs of ice cream can be transported within the same use of space; Sustainable materials: materials used for producing the packaging also might be an important factor. In recent years the interest in products which are environmentally friendly has risen.
An example of would be a package that is going to be recyclable or bio-degradable as the harm at the environment would be significantly reduced. Hardening: The packaged ice-cream is placed into a blast freezer at -30° to -40° C where most of the remainder of the water is frozen. Below about -25° C, ice cream is stable for indefinite periods without danger of ice crystal growth; Storage: storage of the produced ice-cream can be sustainably improved, due to a new package shape. With a new package shape, Carte D`Or would be able to reduce its storage costs and to improve logistics efficiency. This approach would enable to leverage the logistics process. There would be the same storage expenses, although the packs of ice-cream would me increased.
Steps in the process| Activity| Transport| Check| Wait| Inventory| time (hours)| | | Blending of the ingredients| X| | X| | | 30mins| | | Pasteurization| X| | X| | | 30mins| | | Homogenization| X| | X| | | 1h| | | Aging| | | X| X| | 12h| | | Freezing| X| | X| | | 15mins| | | Hardening| X| | X| | | 15mins| | | Storage in the freezer| | | X| | X| 60mins| | | Packaging| X| | X| | | 20mins| | | This table shows the average throughput times of each activity. ——————————————– [ 1 ]. Our mission. (nd). Retrieved 02 16, 2012, from https://www. unilever. com/aboutus/ourmission/ Paper&Board – Unilever Sustainability. (sd). Opgeroepen op 02 13, 2012, from http://www. sustainable-living. unilever. com/the-plan/sustainable-sourcing/pape