The Business process of the Ferrero organization

The Business process of the Ferrero organization portalFor my Business Process module of the BA Business Enterprise social class I looked into several companies, whatsoever small and some large. However, still receptive on which telephoner to pursue, I took a walk to my local stock to buy my two sons a special treat. The shop has a considerable array of goodies for children including two chocolate and toys. My two boys both wanted a Kinder amazement junkie as they get both chocolate and a toy. This made me think, I remember Kinder Surprise eggs when I was a small boy and how excited I use to get when I went to the shop to buy one. This made me think, how a product digest contain the written report, gross sales and recognition from generation to generation without fading away or world challenged by competitors?With all this in mind I firm to base my propose on the Ferrero Company.During the research gathering process I digest cumulated the following reasons why Ferr ero ordain be an ideal union for my project-Massive confederacy offset and GlobalisationMulti generational market (Kinder Surprise Egg)Devotion and consanguinity with all their employeesOutstanding contri exception to the residential areaProblems the company has faced in the pastStrategic returns all over competitorsDedication to their Corporate and mixer ResponsibilityUtilising IT development to enhance disseminationRelationship with competitorsOne of the top ten confectioners in the globeThis project (Course work 1) leave introduce you to the Ferrero Company itself, its fantastic history and I get out also talk about its massive global success. I leave explain the Organisational structure of the company, the five levels of resources (Strategic, Tangible, Intangible, comical and Core Competences) and compile a PESTEL report.FerreroThe BeginningBorn in 1898, Pietro Ferrero began his career as a pastry dough maker in Dogliani, Italy. He clear his first pastry shop i n Turin but was forced to move to Alba during World contend II. Ferrero sought to develop new products in order to overcome the shortly supply of traditional pastry ingredients. By the end of the war, Ferrero had developed a new spread which combined hazelnuts, cocoa butter and vegetable cover. Ferrero called the cattle ranch pasta gianduja which he began selling in 1946. In that year his brother, Giovanni and son, Michele linked the company which had now been incorporated as Ferrero SpA. By the end of 1946 the company had employed much than 50 workers and had approx 200 delivery vans distributing their product approximately Italy. In their first year sales had topped 660, Ferrero began contracting farmers to underwrite the supply of hazelnuts prolongd and at the same time improving their quality.1948On 4th September 1948 a huge flood had isolated the milling machinery and put its existence in great danger. However, due to the fantastic relationship the family had with al l their workers, they all including Pietro and Giovanni worked solidly for 4 days and 4 nights in order to save the factory.On 2nd March 1949, Pietro Ferrero died aged 51, his brother Giovanni took the Helm.The 50sBy the 1950s Ferrero had developed its deliver efficient distribution mesh around Italy and opened several depots. By 1954 Ferrero was a household disclose in Italy.1956In 1956 Ferrero opened its first factory abroad in Stadallendorf, Germany. They beatd just two products for the German market and both had an extraordinary success.1957Giovanni Ferrero died in 1957 and Michele Ferrero took the helm. Michele renewed the employment sics in order to boost production done appendd technology and sophisticated machineryThe 60sFerrero moved into France, Belgium, Netherlands, Luxembourg, UK, Austria, Denmark, Sweden and Switzerland.In 1964 Michele Ferrero created NutellaIn 1968 he launched the Kinder Chocolate, especially made for children.The 70s 80sFerrero USA opened i n 1969 followed by Canada, Latin America, southward East Asia and Australia. By the 1980s Ferrero was strategically placed in all five continents.In 1985 two new production engrafts were opened in southern Italy to abet the people devastated by the Irpinia earthquake.The 90sFerrero developed into eastern europium including Poland, Hungary and the Czech Republic along with a new engraft in Poland.Again in November a terrible flood butt against Italy killing many people and damaging the Alba plant. Production was interrupted but just standardized back in 1948, the employees worked alongside the Ferrero to rebuild the plant and get back on its feet. Some of the employees helping to rebuild the plant had just lost their homes to the flood.In 1997, Michele Ferreros sons Pietro and Giovanni became Chief Executive Officers of Ferrero International.The 2000sIn 2006 a new production plant in Canada was opened and by 2009 in that location was more than than 20,000 employees interco ntinental, over 20 different products and a turnover of more than 6 billion Euros.Business UnitsYearsProduction PlantsYearsGermany1956Italy Alba1946Belgium1958Germany1956France1960France1960Italy1964Italy Pozzuolo1965 linked Kingdom1966Australia1974Switzerland1966Ireland1975Sweden1968Ecuador1975Austria1971Italy Balvano1985Ireland1975Italy SantAngelo1985Netherlands1980Belgium1989Spain1988Poland1992Poland1992Argentina1992Luxembourg1993Brazil1994Hungary1994Canada2006Czech Republic1994Cameroon2006Russia1997India2007Ukraine2003South Africa2007Croatia2003Russia2009Greece2005Re package CentreYearsRomania2006United States1969USA1969Social EnterprisesYearsCanada1974Cameroon2004Australia1974South Africa2005Puerto Rico1975India2007Hong Kong1976Japan1978Argentina1992Mexico1992Brazil1994Sri Lanka2004India2004South Africa2004Turkey2005 china2006Ferreros master(prenominal) competitors are Kraft Foods, Mars and Nestle, however you will fit in Course work 2 how integrating with the competitors toilet be of a huge benefit to all parties and the environment.SuccessI deliberate Ferrero is one of the world leaders when it comes to task egress and success, this I draw measured by the following means Phenominal amount of Global business units and Production plantsAmount of EmployeesThe annual turnoverTheir ability to develop their own production machinery in order to gain a strategic reinforcement over competitorsTheir use of Multi Generational merchandising (Kinder Surprise)Their contribution to society and com exasperationate workAnnual profit of 6 billionMore than 20 different productsFrom the small pastry shop in 1946, Ferrero has become match to Forbes (http//www.forbes.com/2009/05/06/world-reputable-companies-leadership-reputation-table.html) the worlds most reputable company as of May 2009. As shown by the history of Ferrero, the growth of the company has been outstanding this is mainly due to the passion and consignment of its owners and employees as wellspri ng as the development of its bizarre brands and its commitment to develop its own production machinery to maintain its strategic edge.Ferrero group founder a lot of their time and money into other schemes such as Opera Sociale set up as a group to help and welcome retired employees and give them a sense of belonging.Social Enterprises, Ferreros commitment to enhancing the lifespan conditions and develop the populations in some of the poorest areas in the world.United Kinder of the World, is set up to enhance the health and development of children and young people.Kinder + Sport, developed to promote a healthy lifestyle and encourage sports. Since 2007, Kinder + Sport has involved more than 6 million children worldwide in activities in 17 countries.Has you can discipline Ferreros success isnt just measured by the amount of awards it has won or the amount of profit it has made. I believe the level of success that Ferrero has achieved can be seen on the faces of the people and chil dren that the company aid as well as the commitment by all employees.The company Moto of Work, Create, Donate is a clear target of what the company aims to achieve and clearly they take a leak achieved this, consequently successful.Organisational StructureThe table below displays the number of employees and how it is subdivided these figures are taken from the CSR idea 2009,Number of EmployeesAs of 31/08/2009Workers12,993 (60%)Employees6,067 (28%)Executives and Officers1,724 (8%)Managers771 (4%)Total21,555Type of ContractAs of 31/08/2009Indefinite Contracts17,460 (81%)Fixed Term Contracts4,095 (Including seasonal workers 11%, interns 1% and fixed term contracts 7%)Total21,55544% of employees are women and 56% are men. 83% of staff are based in EuropeThe Ferrero Company is based around a playal Structure with their main Headquarters being in Italy. The Ferrero board will meet and dispute initiatives and business and then forward on their decisions to apiece Director of apiece separate sub company i.e. Ferrero Belgium Ferrero Germany. The companies are run in a mirror image scenario, for each one sub company will have its own HR team, Production team, marketing and purchasing team. However each sub company will run exactly like each other in respect of what product they are producing, how the HR Function is run and where they get their produce. The only difference will come from the marketing team because each rural area has a different social web and need.The Ferrero Company also works on Standardising inputs and outputs model. Each sub company are standardize to what they produce, how they produce it, how the HR Function is run, where they get their produce and how their staff are trained. Ferrero have endorsed a huge study piece of land for all employees run by the Ferrero Learning Lab which encompasses several training packages to cover all aspects i.e. Managerial, Nutritional and technical. With this standardisation approach, Ferrero have been able to tender exactly what they do national but globally, without any major issues and disparity.PESTEL analysisFERRERO Pestel AnalysisPoliticalNegativePositiveWith any company transaction globally, the risk of countries becoming unstable and possible war is always freeing to be a risk to production and distribution worldwide.Ferrero has grown comfortably since 1946 this has been possible due to the rapid increase in the European Union, from starting out with 6 members it has now grown to having 27 member states. This growth has allowed for the harmonisation between several countries and its overseas distributions and has allowed for easier expansion through standardised strategies.Ferreros continued support to its Social Responsibilities, mainly that of its support to third world countries has allowed for an excellent relationship and reputation world wide, this has assisted Ferrero with its continued growth throughout these countries.EconomicNegativePositiveIncrease in tub rate and import costs may have an affect on consumer purchasing and may increase the price on products due to both these increases.Price increase on products may not affect sales due to extremely strong brand reputation with the consumers.Ferrero and Mars have teamed up on a joint distribution initiative, both products will be distributed to the same warehouse and then both distributed out together. This will decrease the distribution costs.SocialNegativePositiveSales of confectionary products as a whole decrease during summer months. (see graphs below)Kinder Surprise egg utilises Multi Generational Marketing and has become a collectible item worldwide. Each country produces its own toys in respect to its countries niche at the time. E.g. Super miniskirt Smurf parade issued in Germany.It is a well known fact that more chocolate is sold at Christmas and Easter than any other multiplication and will continue to do so.The reputation institute in sassy York awarded Ferrero 1st Place a s the company with the best overall reputation with the consumer public.Excellent long term relationships with suppliers.TechnologicalNegativePositiveFerrero enforced the SAP Extended warehouse development application which will increase distribution, decrease wastage, increase production, increase distribution timeliness and maximise stock capacities.Ferrero have developed at least 50% of their own production machinery and technology in order to hold a strategic advantage over their competitors.EnvironmentalNegativePositiveThe prospects of global warming will always be an issue with regards to growing and producing its raw materials i.e. Cocoa, palm oil and sugar cane.Ferrero prides itself on its contribution to protecting the environment and is actively alter to saving energy and increasing raw material production. The Corporate Social Responsibility report 2009 details all contributions and future projects Ferrero have implement and are implementing. The 5R recycling project by Ferrero on all packaging it produces helps the environment and the companys reputation.LegalNegativePositiveThe Kinder Surprise Egg was criminalize in the USA since 1997 due to the Consumer Product Safety Commission deeming it being a hazard to small children because it may contain a choking hazard. The Egg also falls foul to the US 1938 Federal Food, dose and Cosmetic act which prohibit embedding non-nutritive items in confections.Ferrero counter acted the US Laws by producing and selling the Kinder chocolate without the surprise, this was again a huge success. The Kinder Surprise egg however, is still sold illegally around the US by shops import them in from other countries. The law as made the Kinder Egg some what a highly sort collectible in the US and as indirectly assisted in the marketing of the egg.This graph below shows the amount sales of the Sugar and Chocolate sales throughout the year (calculated in weeks). As mentioned in the PESTEL Report the summer moves takes a clear plunge in sales.The graph below shows Ferreros annual turnover in 2006 compulsive by season. The red line represents the average sale during the year. As you can see 80% of sales were achieved out of the summer months and only 20% during the summer months.ResourcesStrategic CapabilitiesTangible ResourcesIntangible ResourcesUnique ResourcesCore Competencies mother 50% of its own production machinery and technologyFerrero have production plants and offices worldwideExcellent worldwide reputationPowerful brand name with the Kinder Surprise and TIC TAC mintsKinder surprise has become a collectors item worldwide and will continue to do soThe new implementation of the new distribution and entrepot IT softwareAll employees are motivated and made to feel like part of the Ferrero familyHigh level of training providedDeveloped their own unique product the chocolate and hazelnut paste CreminoTeamed up with Mars to increase distribution speed and cut cost and help cut heap CO2 emis sionsExcellent Training and Human resource managementUnique ties with raw material sources worldwideMulti generational marketingCoursework 2CW2 will be focussing on Ferreros Value chain, Supply chain management, study Analysis and I will be make my own conclusions and recommendations on Ferrero