unilever structure & design

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Group Members::

Group Members: Zoya Mubeen Ayoub Madiha Irshad Summera Nawaz Hira Sattar Idreesi Mehwish Javaid Sumaira Naz Iqra Ishtiaq BB-10-09 BB-10-29 BB-10-30 BB-10-32 BB-10-34 BB-10-39 BB-10-43

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Organizational structure and Design Zoya Ayoub BB-10-09

Contents::

What is organization? What is organizing? Defining organizational structure Unilever organization structure (as case study) Key elements of Organizational structure What is organizational design? Models of organizational design Contingency factors affecting an organization Organizational designs Bondaryless organizations Conclusion Contents:

Organization???:

Organization??? Distinct purpose Deliberate structure people

Organization???:

Organization??? A deliberate arrangement of people to accomplish some specific purpose.

What is organizing???:

What is organizing??? Arranging and structuring work in such a way that organizational goals are accomplished. Important process during which managers design an organizational structure.

Organizational structure::

The formal arrangement of jobs within an organization. The structure which can be shown visually in organizational chart. Managers are involved in organizational design when they create or change structure. Organizational structure :

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History: British-Dutch Multinational company. Founded on 1 st January 1930 by the amalgamation of British soap maker Lever Brothers and Dutch Margarine producer Margarine Unie . Weaving hands together let Lever Brothers and Margarine Unie survive the great Economic depression in early 20 th century . Palm-oil was the major content of production for soap and margarine, therefore their merger made let them import more Palm oil efficiently.

Unilever corporate vision::

Helping people to look good. Feel good. Get more out of life. Unilever corporate vision:

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Product Line: Personal care products. Home care products. Food products.

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Top 25 brands = almost 75% of Unilever’s sales. * As at end 2009 Big global brands

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Unilever’s portfolio of categories Leading category positions Ice Cream & Beverages Personal Care Homecare Savoury, Dressings & Spreads Strong category positions

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Fast facts - 2009 163,000 employees at the end of the year 20 nationalities among our top tier managers More than 170 countries in which our products are sold 264 manufacturing sites worldwide €891 million invested in R&D worldwide €89 million invested in community programmes worldwide

Fast facts::

2 billion consumers use a Unilever product on any day. Top 13 brands with combined sales of €23 billion in 2009. €5.3 billion invested in advertising and promotion. Fast facts:

Scale and geographic reach:

Scale and geographic reach The Americas €13 billion turnover 4.2% underlying sales growth 32.3% of group turnover AAC €15 billion turnover 7.7% underlying sales growth 37.4% of group turnover Western Europe €12 billion turnover -1.9% underlying sales growth 30.3% of group turnover 2009 turnover €39.8 billion

Manufacturing:

264 manufacturing sites. Continuous improvement in eco-efficiency in factories (1995–2009): 41% reduction in CO 2 from energy 65% reduction in water use 73% reduction in total waste Manufacturing Preliminary data pending audit.

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Unilever manages a number of partnerships globally. Customer partnerships

Sumaira Naz BB-10-39:

Key elements of organizational structure Work specialization Departmentalization Centralization and Decentralization Sumaira Naz BB-10-39

Key elements of Organizational structure::

Key elements of Organizational structure:

Work Specialization:

Work Specialization degree to which tasks in the organization are subdivided into separate jobs. can be viewed as a means to make the most efficient use of employee's skills

Work specialization in Unilever:

In unilever all the departments i.e. Health and hygiene and Nutrition have work specialization (to increase efficiency and productivity) Work specialization is important because its results in division of labor which helps in: Work specialization in Unilever

Advantages:

Increase efficiency Save time Accuracy in production Create dependence Cause monopoly Increase unemployment Advantages Disadvantages

Specialization result in human diseconomies::

Specialization result in human diseconomies:

Departmentalization :

Ways of Classifying and Grouping Work Activities Departmentalization

Five types of departmentalization:

Five types of departmentalization

Functional departmentalization :

Efficiencies due to similar specialties, common skills etc. Positive aspects: Coordination within functional area functions reflect the nature of the business In-depth specialization Negative aspects: Poor communication across functional areas Limited view of organizational goals Functional departmentalization

Product departmentalization :

assembles all functions needed to make and market a particular product -under one executive Positive aspects: Increased ACOUNTABILITY and product PERFORMANCE Managers can become experts in their industry Negative aspects : Fails to encourage innovations and creativity Limited understanding of overall organizational goals Product departmentalization

Geographical departmentalization :

jobs on the basis of territory or geography Positive aspects: effective and efficient handling of specific regional Adaptation to unstable environment; High customer satisfaction; Negative aspects: feel isolated from other organizational areas Duplication of functions Geographical departmentalization

Process departmentalization :

Groups jobs on the basis of Product Flow Positive aspects: More efficient flow of work activities Negative aspects: Can only be used with certain types of products Process departmentalization

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Groups jobs on the basis of Common Customers Positive aspects: Focus on customer needs Negative aspects: Duplications of resources Cross-department communication difficult Customer departmentalization

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Michael Trescho Paul Polman Chief Executive Officer Jean-Marc Huët Chief Financial Officer The Rt Hon The Lord Brittan of Spennithorne QC, DL Wim Dik Louise Fresco Ann Fudge Charles Golden Narayana Murthy Hixonia Nyasulu Kees Storm Jeroen van der Veer Paul Walsh Chairman Executive Directors Non-Executive Directors Board of Directors

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Genevieve Berger Chief R&D Officer Sandy Ogg Chief HR Officer categories Regional Functional

Unilever Pakistan-organizational structure:

Unilever Pakistan-organizational structure

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Environment is stable. Company is large. Lower-level managers do not want to have a say in decisions. Environment is complex, uncertain. Company is geographically dispersed. Lower-level managers are capable and experienced at making decisions. Centralization Vs Decentralization

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An organization is never completely centralized or decentralized. In unilever geographic and customer departments have decentralized structure.

Mehwish Javaid BB-10-34:

Chain of command Span of control Formalization Mehwish Javaid BB-10-34

Chain of command:

Chain of command

CHAIN OF COMMAND :

CHAIN OF COMMAND system whereby authority passes down from the top through a series of executive positions in which each is accountable to the one directly superior.

Following three factors help to understand chain of command:

Following three factors help to understand chain of command Authority Responsibility Unity of command

Chain of command chart:

Chain of command chart

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Span of control

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Definition Span of control refers to the number of subordinates who repots directly to the single manager or supervisor.

TYPES OF SPAN OF CONTROL:

TYPES OF SPAN OF CONTROL

Effects of narrow span of control:

Effects of narrow span of control A narrow span of control allows a manager to communicate quickly with the employees under them and control them more easily. Feedback of ideas from the workers will be more effective. It requires a higher level of management skill to control a greater number of employees, so there is less management skill required.

Effects of wide span of control:

Effects of wide span of control There are less layers of management to pass a message through, so the message reaches more employees faster It costs less money to run a wider span of control because a business does not need to employ as many managers

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VIEWS ABOUT SPAN OF CONTROL The classical view favored small spans, typically no more than six, in order to maintain close control. The contemporary view establishes that more and more organizations are increasing their spans of control.

Span of control depends upon the following factors:

Span of control depends upon the following factors The type of product being made Skills of managers and workers

In context of unilever:

In context of unilever There was a narrow span of control in unilever. But unilever is moving foreword for adopting wide span of control

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Unilever is moving towards wide span of control by reducing lower layers.

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The degree to which there are standardized rules and procedures governing the activities of employees . Formalization

In context of unilever:

In context of unilever There is low formalization in unilever. Rules and regulations are uniformly apply on everyone.

MADIHA IRSHAD BB-10-29:

What is organizational Design Models of Organizational Design MADIHA IRSHAD BB-10-29

What is Organizational Design?:

The manner in which a management achieves the right combination of differentiation and integration of the organization’s operations in response to the level of uncertainty in its external environment. It is concerned with developing or changing the organizational structure . What is Organizational Design?

Models of Organizational Design:

Models of Organizational Design There are two models of Organizational Design: Mechanistic Organization. Organic Organization.

Mechanistic structure:

The mechanistic structure , sometimes used synonymously with bureaucratic structure, is a management system based on a formal framework of authority that is carefully outlined and precisely followed. Mechanistic structure

Organic structure:

Organic structure An organic structure is a management system founded on cooperation and knowledge-based authority.

Organic structure:

Organic structure Combines THINKING with DOING Grows in the SOIL of its ENVIRONMENT

Mechanistic VS Organic Model:

Mechanistic VS Organic Model A rigid and tightly controlled structure High specialization Rigid departmentalization Clear chain of command Narrow spans of control High formalization Centralization Limited information network (downward) For example: BZU Highly flexible and adaptable structure Cross functional team Cross hierarchical team Free flow of information Wide spans of control Less formalization Decentralization Free flow of information For example: UNILEVER .

Design of UNILEVER:

A cross functional team is a team composed of at least three members from diverse functional entities work ing together towards a common goal. This team will have members with different functional experiences and abilities, and who will likely come from different departments within the organization. Design of UNILEVER Cross functional teams UNILEVER FINANCE, BUYING & MARKETING departments work together to achieve the overall mission.

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In which top managers, middle managers, supervisors and operatives employees participate in decision making and where peers and others above and below the employee do their performance. CROSS HIERARCHIAL TEAMS Design of UNILEVER

Unilever span of control:

HOC controller. Ismail Tahir HR Manager. Mohsin Nishat R & ME. Talha Kidwani Operation Mgr. PP Irfan Bhatti Service eng. Fayaz H Shah WM-RF SHAHID RAFIQUE Unilever span of control Unilever has a wide span of control.

Free flow of information:

Unilever has a strong communication between its different departments and they coordinate through it. They have the ability to handle more information. Free flow of information

Flow of information:

Flow of information

Formalization :

Formalization In UNILEVER there is less formalization. There is a flexible environment in UNILEVER. Raabta Consumer Careline Whether you've got a complaint, compliment or suggestion, we would love to hear from you.

Iqra Ishtiaq BB-10-43:

Contingency factors Iqra Ishtiaq BB-10-43

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How an organization is going to position itself in the market (in terms of its product) is considered its strategy. Strategy

TYPES OF STRATEGY:

Differentiation strategy leads to organic structure Cost leadership strategy leads to mechanistic structure TYPES OF STRATEGY

UNILEVER strategy:

Innovation is the engine of Unilever’s growth; the lifeblood of our business. Our future depends on our ability to bring bigger & better innovations to market more quickly than our competitors. UNILEVER strategy

UNILEVER Areas of Innovation:

R & D Food and Nutrition Hygiene health and beauty UNILEVER Areas of Innovation

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Firms change from organic to mechanistic organizations as they grow in size. Size

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Unilever working as large organization with more than 2,000 employees .

Technology and structure:

Technology and structure The way by which tasks are accomplished using tools, equipments, and techniques.

Technology Classification:

Technology Classification

UNILEVER TECHNOLOGY.:

We apply our scientific capabilities to advances in nutrition, health and well-being. Lifebuoy aims to provide affordable and accessible hygiene solutions that enable people to lead a life free from hygiene related worries, everywhere, regardless of the boundaries of nationality, religion and socio-economic status. UNILEVER TECHNOLOGY. Activefresh care nature total Lifebuoy Bodywash care Lifebuoy Bodywash total Lifebuoy Handwash care Lifebuoy Handwash classic Lifebuoy Handwash fresh Lifebuoy Handwash nature

UNILEVER Technology:

UNILEVER Technology Surf excel Rs.10 Surf excel Rs.15 Surf excel Rs.20 Surf excel Rs.50 Surf excel 500g Surf excel 1kg Surf excel 2kg Surf excel Rs.40

Environment:

The environment is the world in which the organization operates. Environment is often classified as: Stable Dynamic Environment

Environment:

Stable Environment The customers' desires are well understood and probably will remain consistent for a relatively long time. e.g. Manufacturing Firm. the customers' desires are continuously changing—the opposite of a stable environment e.g. Electronics Industry. Dynamic

How UNILEVER cope up with environmental uncertainty.:

Reduction of GHG Reduction of water from manufacturing. Reduction of wastes through recycling. How UNILEVER cope up with environmental uncertainty.

Reduction of GHG.:

Reduction of GHG.

Hira Sattar Idreesi BB-10-32:

Organizational Designs Traditional Designs Contemporary Designs Hira Sattar Idreesi BB-10-32

Types of Organizational Designs:

Types of Organizational Designs Traditional Designs Contemporary Designs

Traditional Designs :

Traditional Designs These are more mechanistic and includes Simple Structure Functional Structure Divisional Structure

Simple Structure:

Simple Structure Very common in small start up businesses low departmentalization, wide spans of control, centralized authority, and little formalization usually no standardized policies and procedures Unilever is a giant organization It cannot be run efficiently and effectively under a simple structure

Functional Structure :

Functional Structure It groups similar or related occupational specialties together Leads to departmentalization of the entire organization Unilever Pakistan Limited has a functional structure – its has departments including Finance Human Resource Marketing Information Technology

Divisional Structure:

Divisional Structure Made up of separate, business units or divisions Each division has its own goals to accomplish suitable for medium sized to big companies

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Unilever manufacturing department was split into 2 separate global units Foods 54 % HPC Home and Personal Care 46 %

Forms of Divisional Structure:

Forms of Divisional Structure Product division Customer division Geographic division

Product division :

Product division Product division is created when things are specific in the production process Unilever has 3 separate global units Foods Brands Home Care Brands Personal Care Brands

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Organization sells products to diverse group of customers Unilever’s also have diverse product range Badami” is Wall’s response to the traditional Kulfi. 156,264 Badami’s are sold in Pakistan every day. Customer division

Geographic division:

Geographic division Its done to locate facilities close to customers who have differences in regional tastes or needs. Unilever as global organization has following regions: The Americas; Western Europe; and Asia, Africa and Central & Eastern Europe

Contemporary Designs:

Contemporary Designs Focuses organic model ,its more flexible and adaptable & includes Team Structure Matrix Structure Boundary less Organization

Team Structure :

Team Structure A design in which an organization is made up of teams Each team works towards a common goal. Teams may have a group leader who is in charge of the group. No hierarchy or chain of command

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Its effective for solving ongoing problems Members are responsible for the progress of teams Unilever Food Solutions’ team of highly skilled chefs and nutritionists, help customers find the right balance of taste and health

Matrix Structure :

Matrix Structure Allows specialists from different functional departments to work on one or more projects Its organic and flexible Faster decision making Better customer service.

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It has dual chain of command including Functional manager and project manager manager has the duty of allocating all the resources needed

Matrix Structure:

Matrix Structure When Unilever adopted brand focusing strategy, it used matrix structure . Unilever Sunsilk introduces 1st ever shampoo for covered hair in Pakistan!

Summera Nawaz BB-10-30:

Boundary less organization. Challenges Summera Nawaz BB-10-30

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Boundary less organization Breaking down the External vertical and horizontal Barriers Minimum chain of command Limits span of control Replace departments with empowered Teams

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Network organization. A group of legally independent companies or subsidiary business units that use various methods of coordinating and controlling their interaction in order to appear like a larger entity provide other needed product components or work processes Types of Boundary Less Organization

Micro drip..:

Micro drip.. Unilever is supporting Acumen Fund’s project in Pakistan . Network created by these both is called Micro Drip (Pvt.) Ltd. They are running project called Thardeep Rural Development Programme (TRDP) at thar. Unilever is providing fund and skills and expertise required to Drip Irrigation projects.

Virtual organization.:

A temporary network of independent companies suppliers, customers, subcontractors, even competitors. All are linked primarily by information technology they share skills, access to markets, and costs Virtual organization.

Sunsilk co-creation.:

Sunsilk co-creation. Sunsilk hire 7 experts from the world to improve the quality of their products.

Organizational challenges :

Organizational challenges

Keeping Employees Connected::

Now a days it is a big challenge to keep diversified workforce connected. Effective communication between employees leads to higher revenues. Keeping Employees Connected:

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Adopt an organic, networked organizational form. Encourage their employees to learn Flexible enough to changes in the environment so they will prosper tomorrow Have the capacity to adapt to unforeseen situations to learn from their own experiences to change more quickly, broadly, and deeply than ever before. Learning organization

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Managing global issues: The strategies and types of structures in the organization are the same across the globe. Difference is the essence of the culture Unilever produces Halal edibles for Muslim customers.

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Around the corner, across the state, or on a different coast. Competitors are everywhere, and getting an edge requires identifying them. Major competitors are: Nestle AVON Threat of competitors

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Unilever believes Sustainability is critical to continuous success of our business, environment and society to live in. launched its new vision in late 2009. “Unilever Sustainable Living Plan” to achieve the goal by 2020. Sustainability

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Unilever Pakistan’s Sustainable Living Plan focuses on the following: Reduce the Environmental Impact . Enhancing Livelihood. Improving Health& Hygiene Promoting Sustainable Workplaces

Conclusion:

No matter what's structural design managers choose for their organizations ,the design should have employees do their work in the best, most efficient and effective way they can. Conclusion

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