Principles of Management

INTRODUCTION TO UNILEVERINTRODUCTION TO UNILEVER

• Unilever is an Anglo-Dutch multinational corporation that owns many of the world's consumer product brands in foods, beverages, cleaning agents and personal care products

• 223 000 employees world-wide• Brands on sale in 151 countries• Consumers choose Unilever products 150 million

times every day• Unilever's main competitors include PepsiCo,

Procter & Gamble, Nestlé, Kraft Foods, S.C. Johnson & Son

Principles of managementPrinciples of management

• Planning

• Organizing

• Staffing

• Leading

• Controlling

PLANNING

MISSION

• Add Vitality to life.

• Unilever meet everyday needs for nutrition; hygiene and personal care with brands that help people feel good, look good and get more out of life.

Vision statement

• Touching heart changing lives

Objectives

• To be honest, transparent and ethical in our dealings at all times.

• To win the hearts and minds of consumers. • To deliver what they promise. • To become empowered leaders who are

inspired by new challenges and have a bias for action.

• To believe in trust, truth and outstanding teamwork.

• Unilever care about and actively contribute to the community in which they live.

Rules and Regulations

• There shall be compliance with all applicable laws and regulations of the country where operations are undertaken

• There shall be respect for human rights, and no employee shall suffer harassment, physical or mental punishment, or other form of abuse

• All products and services will be delivered to meet the quality and safety criteria specified and will be safe for their intended use

• Safe and healthy working conditions will be provided for all employees

Strategies

• Product Development• Corporate Strategies• Human Resource Strategies• Finance Strategies

MBO

• Mbo links Unilever objectives and the behavior of individuals. Because it is system that links plans with performance, it is a powerful implementation technique

• In Unilever MBO process involves:• Establishing and communicating Unilever objectives• setting individual objectives• Developing an action plan of activities needed to

achieve the objectives.• periodically reviewing performance as it relates to

the objectives and including the results in the annual performance appraisal

Tows matrix

BCG Matrix

Cash Cows

• They generate more cash than required.• They extract the profits by investing as little cash as

possible• They are located in an industry that is mature, not

growing or declining.• · Surf excel• · Ponds• · Lipton• · Close up• Blue band• Lifebuoy soap• · Rexona• · Knorr

Stars

• It leads to large amount of cash consumption and cash generation.

• They also require heavy investment, to maintain its large market share

• Attempts should be made to hold the market share otherwise the star will become a CASH COW.

• Lux• Sunsilk• Wall’s• Fair & lovely• Rafhan• Energile

Question Marks

• They will absorb great amounts of cash if the market share remains unchanged, (low).

• Why question marks?• Question marks have potential to become

star and eventually cash cow but can also become a dog.

• Investments should be high for question marks.

• Clear shampoo• Rin

Dogs

• In this area your market presence is weak so its going to take a lot of hard work to get noticed .also you won’t enjoy the scale economies of the larger players so its going to be difficult to make a profit

• Wheel• · Supreme tea• · Lifebuoy shampoo

Competitive Strategy• Due to slow performance in emerging markets as compared to

competitors Unilever adopt “GROWTH STRATEGY”• Reduced portfolio to 400 brands• Focus on R&D & innovative product• Growth through acquisitions• But this strategy failed in 2004 due failure in advertising &

marketing effort• Reported net loss of 318M dollars• So what’s next???• Then Unilever adopt two strategies• Reorganize organizational structure to focus on needs and

wants of consumers & brand management• Implement Unilever believers, product & brand extensions, use

advertisement that connects with consumer needs & increase consumer focus on health & nutrition products

Decision making criteria

• Centralized system of decision making

• Authorities given to regional managers

• Most of the decisions are made by the board of directors by voting

• Each one has one vote

Organizing

Identification of departmentation

• Human resource management• Marketing department• Commercial department• Sales department• Finance department• Payroll department• Information technology department• Engineering department• Administration• Auditing department• Customer care

Vertical structure:• Vertical differentiation:

• Reporting relationships that link people, tasks and functions– appropriate span of control

• Tall structures– impede communication & coordination– distort information (intentional & non-intentional)– decreases motivation – too many middle managers (structure begets structure)

• Vertical differentiation:– Centralization:

– easier coordination of activities– speedy decision making

– Decentralization:– motivation & accountability increase– fewer managers are needed

Problems with vertical Structurein Unilever

• Principle of minimum chain of command– Maintaining a hierarchy with the least

number of levels of authority needed to achieve a strategy.

Centralized or decentralized structure:

• In case of Unilever the organizational structure is almost shared structure in nature. As it is a multinational organization and almost all such type of organization have decentralized structure. Unilever has also decentralized structure in mostly departments but in almost departments there is a shared structure

Staffing

Staffing:

• The recruitment process at Unilever can be classified into following stages:

• personnel planning and vacancy announcement

• nature of application form• recruiters qualification• channels of recruitment• recruitment –constraints and challenges

Selection process in Unilever:

• reception of application• Evaluating reference and biographical data• Employment test • assistant candidate through interview• Cognitive ability test• Physical ability test• Work samples • Hiring decision

Leading:

Democratic style:

– Participative style– The leader involves one or more employees in the

decision making process – Leader maintains the final decision making

authority.– Allows everyone to be part of a team—everyone

feels that they have participated and contributed.– Encourages participation, delegates wisely,

values group discussion.– Motivates by empowering members to direct

themselves and guides w/a loose reign.– Negative—everything is a matter of group

discussion and decision

Compensation and benefits:

At Unilever following benefits and compensations are given:

• Medical facility to employee and his/her parents

• Paid vacations• Accommodation facility to energetic

employees

CONTROLLING

Controlling

• Staff control

• Quality control

• Product control

Suggestions and recommendations

Suggestions:

• Unilever is one of the manufacturing sector who need to produce more output by implementing new techniques, new tariffs and new consumer satisfaction value added service. Further, it is still the largest manufacturer in the world in terms of geographic reach and quality.

RECOMMENDATIONS:

• They should encourage new products

• Bring innovations in the existing products

• They should conduct more surveys in order to know about consumer satisfaction level

• Easy access for communication should be provided in