TaskA: Briefintroduction of the company i.e.
history, their services etc.Unilever is an international consumer goodsmanufacturer with over 400 brands of food, beverages, households and alsopersonal care products. Unilever embraces that Unilever Sustainable Living Plan(USLP) is the central of its business model to achieve balancing in accomplishits business profit and also make good use of natural resources in itsindustrial manufacturing process. Thefounding of Unilever is based on the innovation of Sunlight Soap, the firsttablet soap by William Hesketh Lever in 1890, which succeeded in popularisingthe importance of cleanliness and hygiene among people in Victorian England. Sofar, Unilever is still implementing his deeds of making sustainable livingcommonplace as its business purpose. Unileveris looking forward for implementing a sustainable and better future which canimprove people’s health and reduce any environmental issues while in developingof its business as well.
On the way of creating a brighter future, it invokesdifferent parties such as its own related management departments, consumers,government, non-governmental organisation and other business operators to worktogether in building the safe and sound place for every creature. To attainits vision, Unilever enforces a comprehensive strategy for its long-termbusiness growth. Given the highest standard of cooperate behaviour it has,Unilever can make a positive social impact by building the steady relationshipwith the entire society.
With the change of time, Unilever intends to fulfilcustomers insight to maintain its competitive and profitable long-term growthby its perfect combination of science and technology and also its supply chainmanagement. TaskB:Conduct an extensive research using internet, academic journals,textbook or reliable resources on how the company implements its Managementfunctions i.e. Planning, Organizing, Controlling & Leading.The fourtraditional functions of management – planning, organizing, leading, andcontrolling – are the fundamental management principles that are still relevantin the rigorous business world today.
It is widely practiced by executivesacross industries, including Unilever, which operates in the fast-movingconsumer goods (FCMG) industry that is extremely large and competitive. Planning Organizing Leading Controlling Planning is the process of establishing the goalsof an organization and developing in advance the appropriate activities thatshould be executed in order to achieve said goals. Thus, this traditionalfunction of management consists of various levels of decision making. (Bateman& Snell, 2015) Unilever’s vision is to grow our business,while decoupling our environmental footprint from our growth and increasing ourpositive social impact (Unilever, 2017). Unilever’s Corporate Purpose statesthat to succeed requires “the highest standards of corporate behaviourtowards everyone we work with, the communities we touch, and the environment onwhich we have an impact.
” These lay down the groundwork for theorganization to come up with milestones and procedures for their employees sothat they could contribute in the achievement of their organizational goals. In2009, Unilever launched The Compass, a strategy detailing sustainable growth;and in 2010, the Unilever Sustainable Living Plan was introduced, and it laidthe groundwork in achieving Unilever’s goal in causing positive impactenvironmentally and socioeconomically in line with the United Nation’sSustainable Development Goals. The four Compass Pillars are: (1) Winning withbrands and innovation, (2) Winning in the marketplace, (3) Winning throughcontinuous improvement, (4) Winning with people. Before deciding on the direction of thecompany, Unilever first did a thorough situational analysis on their market,and access various challenges that their company might face in theiroperations. Then, they come up with strategies and plan to address theseproblems.
InUnilever’s 2016 Annual Report, Unilever identified the social challenges in theconsumer market. Even though the older generation has significantly more spendingpower than younger generations who are exposed to higher levels ofunemployment, research shows that by 2025, Millennials may spend more innatural and more authentic products. Interest in sustainability issues has alsoskyrocketed, and Unilever found that 54% of consumers are either buying or areopen to buying sustainably. Thus, in order to adapt to this ever-changingconsumer demand, Unilever has focused more in producing and innovating productswith natural formulations, such as food with organic and traceable ingredients.Also,even if the economical growth in the European continents was slightly slow dueto external factors such as Brexit, the emerging markets, where Unilever hasaround 70% of its volume in it, will generate higher levels of consumption percapita, that would both boost demand for FCMG products in the long run. Thus,the Annual Strategy Report noted that the company has reinvested in rebalancingportfolios to ensure the long term growth of the organisation, and that costreduction was a major factor in the decision making process.
Unilever’s fourcategory strategies – Personal Care, Foods, Home Care, and Refreshment – eachhas specific priorities aimed at growing sales and delivering improvedfinancial metrics to sustain the company against the low global market growth.One of the significant efforts of Unilever in market development is theacquisition of the Dollar Shave Club, which grew the E-Commerce of the companyas much as 47% year-on-year. Themeticulous situational analysis and detailed business planning of Unilever hasresulted in a total turnover of € 52,713 million. It also generated a total netprofit of € 5,547 million in 2016 for the company. Organizing concerns the assembling and coordinatingof the human, financial, physical, informational, and other resources needed toachieve goals, including activities such as attracting talent, specifying jobresponsibilities, and allocating resources. Organizing also means creating an organization chart that views humancapital as their most valuable resources, and is flexible and adaptive inresponse to competitive threats and consumer needs. (Bateman & Snell, 2015)In2016, Unilever underwent a major organisational change through the Connected 4Growth (C4G) programme, which aimed to create a faster, more agile, and morecompetitive organisation. Unilever seeks to empower people through C4G byencouraging entrepreneurial thinking and action, which in turn will indirectly attractthe right talents from the increasingly competitive labour market.
Unilever N.V. and Unilever PLCoperate as a single economic entity since 1930, and this was possible due tospecial provisions in the Articles of Association of NV and PLC, and theFoundation Agreements (The Equalisation Agreement, the Deed of MutualCovenants, the Agreement for Mutual Guarantees of Borrowing between NV andPLC). With this, the unity of management, operations, shareholders’ rights,purpose and mission can be achieved. As seen in the diagram to the left,Unilever is currently reviewing their legal structure in an effort to simplifyand increase flexibility so that there is more options for strategicallyportfolio change in the future.
TheBoards of NV and PLC are responsible for the corporate governance of Unilever,and are accountable for the company’s management, general affairs, direction,performance, and long-term success. The Boards are one-tier boards, where thesame people are on both Boards. Directors, which consist of Executive Directorsand Non-Executive Directors, have a collective responsibility in running thecompany with their supervisory role. Thereare four established Board Committees: the Audit Committee, the CompensationCommittee, the Corporate Responsibility Committee, and the Nominating andCorporate Governance Committee. The CEO will be responsible with theoperational running of the company, and are able to delegate any of his powersand discretion to members of the Unilever Leadership Executive (ULE), whereeach member has different job descriptions and departmental responsibilities.The Board will be required to have a minimum of six physical meetings toconsider any strategic, transactional, and governance matters. In 2016, theNon-Executive Directors held 6 meetings to discuss specific agendas. The Board,on the recommendation from the Nominating and Corporate Governance Committee,will nominate a Non-Executive Director to be the Chairman of both NV and PLC.
The Chairman will then lead the Board and conduct shareholders meetings for thecompany. Outsideof corporate governance, Unilever also utilizes a number of effectiveorganizational strategies to boost their business performance. According toThompson (2017), Unilever’s operational management (OM) is one of the mainreasons for the high productivity of the company. By focusing on short-term andintermediate schedules for resource utilization, it enables the company to beflexible in its operation in satisfying target consumers. As an example,regional operation managers will adjust schedules based on the relevant marketconditions. Besides, Unilever handles its slack resources by utilizingeffective inventory management, where the company aims to maintain an adequateinventory to respond to sharp peaks in demand.
Thompson notes that Unileverapplies the perpetual method and periodic method of inventory management. Thejust-in-time (JIT) system minimizes holding time and corresponding costs ininventory operations. Leading, on the other hand, is the manager’sefforts to stimulate high performance by employees. Good leaders stimulatepeople to be high performers through motivating, communicating, guiding, andinspiring employees towards achieving team and organizational goals (Bateman , 2015).
The ‘Winning with People’ pillar in Unilever’s Compass indicatesthat the company are aware that human capital is essential to their companies’growth, and that efforts are made to attract and retain talent into theirbusiness. The development of the C4G programme is the best proof for thestatement. Unilever’sHuman Resource has three priorities in working to accelerate business growth.Firstly, they focus their activities on Wellbeing, Talent, Learning, andReward. Second, they build teams and connect them with technology to fosterempowerment and agility. Thirdly, the Human Resource department seeks to powerthe organisation with purpose so that all employees are able to reach theirpotential. Leaders in Unilever are adapting new performance and reward systemsto provide more career development opportunities for high-performing employees.Besides, they implement C4G in attempt to improve top-line growth byencouraging the workforce to experiment and collaborate.
C4Gacknowledges the importance of democratic leadership, which then explains howUnilever is working to remove labels and categorisations in their talentprocess and promote individuals’ development needs. Instead of an autocraticapproach, Unilever managers need to understand their subordinates’requirements, and link them to Unilever’s Learning Hub to receive the righttraining and support so that they could adapt to future market changes andexcel in it. C4G also aims to push a more entrepreneurial approach and anowner’s attitude to the employees, and are now assisting them to generate astrong sense of purpose in their daily work.
The reward principles that themanagers adapt are also becoming simpler, with fewer reward elements that focuson short-term performance, and more that pushes employees to create theirlong-term value. Managers are also required to join a mandatory safetyleadership programme, where they will be tasked to instil best practices intheir teams to protect the wellbeing of their subordinates. Gregory(2017) observed that Unilever’s leaders are able to use market-based andresults-based approaches to motivate and boost employee performance. Thesestrategies fall in line with Unilever’s culture for high performance andquality.
Market-based management is an approach which utilizes market data toalter management strategies, while result-based management focuses on theachievement of desired outcomes. Unilever also practices transparency andintegrity in their leadership culture, which is essential for the implementationof corporate governance, and to maintain a healthy, positive workplace. Thesequalities ensure that the company’s leaders would be able to continue inmaintaining high quality performance even though there are major businesschanges, such as mergers and acquisitions.
Theabove diagram denotes Unilever’s business plan, which seeks to achieve asustainable and equitable growth. This continuous cycle deploys numerouscontrol strategies where Unilever alters its business decision to best suit thesituation at hand. Bateman & Snell (2015) explains that controlling is where performance ismonitored so that appropriate changes can be implemented. Unilever’sbusiness model has integrated their USLP goals into its operation, from aspectssuch as sustainable sourcing of agricultural raw materials, to theeco-production in manufacturing to marketing brands with purpose. Thecontrolling process of Unilever starts by the collection of consumer insightsthrough focus groups and quantitative studies. This enables the company todetect how the market is changing and segmenting, and whether their previousbusiness approaches have been as effective as it could be.
Besides, theConsumer and Market Insight (CMI) group in Unilever monitors data aboutconsumption patterns and social media dialogues. After the necessaryinformational collection, Unilever will then seek to collaborate with differentinstitutions to tackle issues that have surfaced, such as environmentalsustainability. Then, Unilever will go into their research and developmentprocess, where further product innovation are encouraged so that productbenefits are altered to fit to the best of the consumer’s wants. Then,subsequent measures to alter the business plan are went through by thedifferent departments in the company, namely sourcing, manufacturing,logistics, marketing, and sales. Then, the cycle starts again to ensure valuesare delivered to Unilever’s stakeholders. Thecontrol process of Unilever has been found effective, as their products are increasinglyresponsive to local needs, and results are landing faster in markets. As anexample, the innovation of Sunsilk Hijab product line indicates that Unileveris aware that the Muslim women desire better formulated hair products thatcould suit their needs.
Besides, the Aguai factory in Brazil now sets the newbenchmarks in sustainability after Unilever deployed control measures toimprove their manufacturing sectors. Unilever also has achieved a 7.5% ofcarbon dioxide emission reduction in 2016 as compared to 2015 by reducing truckmileage, and improving the energy efficiency in warehouses. Their Marketingdepartment has also adapted to the ever changing digital economy by investingmore in their digital platforms, with U-Studio and U-Entertainment for contentcreation. Unilever’s sales department has also increased their focus in smalland convenience stores in response to the annual 5% growth they experience fromconsumers.
All of this are reviewed and certified by the 2016 IndependentLimited Assurance Report to the Directors of Unilever, produced by auditingcompany PricewaterhouseCoopers. TaskC:Based on task A&B, advise the company on the usage of technology inimproving management efficiency and overcoming obstacles In this age of science and technology, itis necessary for a company use advance technology to improve their managementefficiency and overcome obstacles faced by the company. On top of that, thereare four management functions that need to improve to increase managementefficiency.First and foremost, planning is the firststep required in management process.
In this required step, Unilever must do athorough situational analysis on their market research before making a decisionon the direction of the company. Thus, I would like to advise Unilever to useArtificial Intelligence (AI) powered information technology. AI poweredinformation technology is a technology that conduct large scale of dataanalysis by using techniques called “model averaging” to test the importance ofeach factor against all others.
Thus, this technology can help managers to siftthrough vast volumes of data and hence reduce the estimation time for largescale analysis from weeks to a few days. (S, 2017) This helps managersto make a decision faster and more accurate on their planning toward theirorganization goals. On the other hand, (AI) powered information technology inmanagement can both help expose the long-term implications of short-termdecisions because the technology can help to identify unforeseen consequences,or discover new sources of value of the organization. This can help managers toovercome the obstacles of making wrong decision for the operation of thecompany.Secondly, Unilever can utilize the usage ofinternet conferencing such as “Slack” in organizing departments to simplify thedata transmission within the departments.
Slack uniforms entire team’scommunication to make workflow better. By using this app, employees can easilysearch all files and data in one place. Slack also make conversation betweenpeople become easier. Discussion for projects is organised into channels, sothere is place for every project, team, or apartment. Apart from that, physicalmeetings between boards can be held much lesser, which will lead to a cut incost and travelling time.
All the meetings between the boards can be heldonline although they are not gathering together in a meeting room. BesidesSlack, Unilever can apply HR software solution in the organization to streamlinemany of the tasks that took altogether too many hours to complete manually.This software helps to schedule and track both manpower and jobs. With built-infeatures that allow managers to schedule work hours, leaves, holiday breaks andeven paid training hours, HR software frees up managers to deal with employeeson a more personal, face-to-face level as the need arises.For the leading part, Unilever developed aprogramme named C4G programme which acknowledge the importance of democraticleadership instead of an autocratic approach. As a democratic leader, themanagers need to understand their subordinates and requirements, hence linkthem to Unilever’s Learning Hub to receive the right training and support. Interms of that, Unilever can ultimate the usage of technology to develop theright training and support for employees.
For example, Unilever can usetechnology survey such as Google forms to obtain employee’s opinion on whattraining they would like to receive. Google forms create surveys and questionnairesthat gather everything in a spread sheet then manager can analyse the datareceived from the surveys. The spreading of the survey forms will become easierbetween employees through the usage of Google forms by embedding forms oncompany website.
Since the survey is published on the company’s website, allthe employees are able to answer the survey in a short time. Thus, managers cananalyse the results faster without having to send around multiple versions ofthe file. This will help managers to overcome the obstacles of being strugglingto decide a personalised training programme for each employee.The last management function will becontrolling. The controlling process of Unilever is completed by the Consumerand Market Insight (CMI) group in Unilever by collects consumer insightsthrough focus groups and quantitative studies. In my point of view, I wouldsuggest Unilever to apply the technology in their company which is Big DataTechnology created by M-Brain. This technology contains market researchsolutions can support Unilever in establishing customer or supplier behaviourand perception analysis, industry analysis, competitive and market analysis,and so on. This technology helps Unilever to do their consumer and marketinsights analysis accurately without wasting any resources and time.
Hence, itovercomes the obstacles of the difficulty in analysing the mass of data andinformation between the markets and consumers. In a nutshell, there is variety of usageof technologies in improving management efficiency and overcoming obstacles.The most important point is the company itself has to ultimate the usage oftechnology appropriately to achieve organizational goals of the company.