INTERNSHIP REPORT
NESTLE KABIRWALA FACTORY (PVT.) LTD
NESTLE KABIRWALA FACTORY LTD PAKISTAN
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SUBMITTED TO:
MR. MUSTABSAR AWAIS
IN CHARGE INTERNSHIP PROGRAM
ALFALAH INSTITUTE OF BANKING &
FINANCE
B.Z.U MULTAN
SUBMITTED BY:
MUHAMMAD RIZWAN NAWAZ
ROLL NO.52
MBA ( BANKING & FINANCE) 5TH SEMESTER
AL-FALAH INSTITUTE OF BANKING & FINANCE,
BAHA-UD-DIN ZIKRIYA UNIVERSITY, MULTAN
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Internship at Nestle Pakistan Ltd. (Kabirwala Factory) was an attempt to seek experience of the
corporate lifestyle of a successful multinational company. The idea was to understand the
corporate structure, while developing skills needed to thrive, of one of the leading global
multinationals whereas applying the knowledge and skills acquired during the academic career.
This wonderful experience of just 6 weeks proved to be a high inclination in the graph of my
personal learning.
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that the Nestle provides the purest food product to its consumers because it is as sincere with
them as a mother. It is universally understood that this reflects the maternity and affection, and
thus helps to draw a visual link between the name, Nestle and its products.
Nestl is the worlds leading nutrition, health and wellness company. The company employs
more than 280,000 people and has 456 factories in 84 countries. Nestl products are sold in
almost every country in the world. Founded in 1866 in Vevey, Switzerland, where it is still
based, Nestl has often been called the multinational among multinationals. Only about
1.5percent of its sales are generated in its home country, and all but 12 of its factories are
situated abroad. The CEO is Paul Bulcke, and the General Management includes a Belgian, two
Canadians, one Dutch, a Frenchman, a German, a South African/British, three Spaniards, one
Swiss, one American and one Swiss American. Nestl is a truly public company with over
250,000 shareholders of which around one third are Swiss. As the worlds leading nutrition,
health and wellness company, Nestl is the worldwide leader in product categories such as
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MISSION STATEMENT
At Nestl, we believe that research can help us make better food so that people live a better life.
Good Food is the primary source of Good Health throughout life. We strive to bring consumers
foods that are safe, of high quality and provide optimal nutrition to meet physiological needs. In
addition to Nutrition, Health and Wellness, Nestl products bring consumers the vital ingredients
of taste and pleasure.
VISION STATEMENT
The vision of Nestle Group is,
Nestl aim is to meet the various needs of the consumer every day by marketing and selling
food of a consistently high quality. The confidences that consumers have in our brands is a result
of our companys many years of knowledge in marketing, research and development, as well as
continuity consumers relate to this and feel they can trust our products.
SLOGAN
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Location:
Middle of Pakistan
East of Multan
7 Km. from Khanewal direction Kabirwala.
Factory Area:
Total Land 84.46 Acres
Building (Covered) 17.34 Acres
This Factory Fact book was created with the modest aim to provide the Reader with a flavor of
this factorys growth over the years and the present role.
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Product History:
1984: LIQUID MILK BASED PRODUCTS
UHT MILK
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Nestle System:
Nestle has best systems but others are also consulted. Following are the own systems of Nestle
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Nestle Certifications
Certifications of nestle Pakistan Ltd. are as under
ISO 14001(safety)
OSHAS 18001(safety)
HACCP (operation pre- requisite, critical control point, pre-requisite programmed)
Integrated pest management (IPM)
ISO 2200 granting
(Combination of HACCP related to safety and ISO 9000 related to quality and many more
things)
A successful GLOBE system that works for Nestle around the world in order to communicate
confidential data
As a result of management commitment and dedicated effort and hard work Of Kabirwala
factory staff at all levels KBF got the high status in milk powders category amongst all the
Nestle factories around the world in 2001. It was achieved because of continuous
improvement drive and passion to become best in the World.
Kabirwala Factory has got the potential of expansion in existing and extension in the new
categories in the future.
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A Shared Responsibility
Each employee has a distinct responsibility in dealing with people be it as a leader of a team or
as a peer.
HR managers and their staff are there to provide professional support in handling people matters
but should not substitute themselves to the responsible manager. Their prime responsibility is to
contribute actively to the quality of HR management throughout the organization by proposing
adequate policies, ensuring their consistent application and coherent implementation with
fairness. Acting as business partners, the HR manager advises and offers solutions which result
in positive impact on the organizations effectiveness. Furthermore he /she proposes best
practices and provides state of the art support and counseling to his/her colleagues. Together they
act as co-responsible partners for all HR matters.
This partnership is the key for efficiency in people management.
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Motivation:
While they expect loyalty to their company, they expect their people to be critical and suggest
improvements wherever necessary. They like people who are motivated themselves & can
motivate others.
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Recruiting Process
Generating Candidates:
Through following means the candidate are generated
o Career Website
o Generating candidates overview
o Employee Referral Program
o Graduate Trainee Programs
o Internships
o Job fairs
o Job Posting Portals
o Media Selection Guidelines
o Partnering with Universities (CEMS)
Receiving CVs:
They will review and select only and only those CVs out of all, that best match open jobs,
Similarly, only selected candidates are contacted for that purpose. In any case, you will receive
an e-mail telling you when the job you applied for has been filled.
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Recruitment Process
Purpose
This policy applies to all personnel involved in recruiting staff. This policy:
Ensures all recruitment activities are conducted in full recognition of, and
maximum regard for, the principles of equal employment opportunity
Seeks to maximize opportunities to recruit the best person for each job
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Identifying vacancies
It is the responsibility of each line manager to identify vacancies within their department. Where
necessary, the line manager, their manager and the Corporate Recruitment Manager discuss
whether the vacancy should be filled, and if so, whether by a full time, part time or contract
employee.
Authorizing recruitment
A Recruitment Requisition form, signed by the line manager and the Division Head/
NPL HRM / MD, is the only acceptable authorization for initiating recruitment for any position.
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2) Sourcing
a) CV Database:
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by HR + Dept. Head
then by HR + Division Head(if required by Div.)
Management Trainees
then by HR + MD
Interview panels: May be formed for recruitment of positions entailing diverse or multi-faceted
functions. Expert views of different functional Managers may be required at such points. The
Corporate Recruitment Manager will establish interview panels in consultation with the
recruiting Line Manager.
A standard interview guide will be used for each interview so that all applicants are reviewed
against the same criteria. Behavioral interviewing techniques are the preferred method of
conducting interviews.
5. Check references
Carry out and document a minimum of 2 verbal reference checks for the preferred short-listed
applicants. No employment offer will be made prior to the completion of these reference checks.
The applicants highest academic qualification will be confirmed with the issuing academic
institution prior to any employment offer.
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9. Medical clearance
The successful applicants appointment to the Company will be confirmed subject to medical
clearance by the Companys appointed doctor. The cost of this pre-employment medical will be
borne by the Company.
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Professional Development
Learning
Each employee, at all levels, is conscious of the need to upgrade continuously her/his knowledge
and skills. The willingness to learn is therefore a non-negotiable condition to be employed by
Nestl. First and foremost, training is done on-the-job. Guiding and coaching is part of the
responsibility of each manager and it is crucial to make each one progress in her/his position.
When formal training programs are organized they should be purpose oriented and designed to
improve relevant skills and competencies. Therefore they are proposed in the framework of
individual development programs.
Training
NESTLE KABIRWALA FACTORY LTD PAKISTAN
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Performance Evaluation
The performance evaluation (PE) is an annual cycle which aligns your individual objectives with
the business priorities in a given performance year. On-going feedback discussions with your
manager to make sure you are on right track is essential, as it allows you to take any required
measures if needed. This will ensure you and your line managers are aligned throughout the year
and make the yearend evaluation as fast based and effective as possible.
The PE form enables you to structure the PE process in quality way to increase dialogue and
alignment with your line manager.
At the end of the year, you will receive PE Rating, which will be based on the level of your
performance against your objective. This PE rating includes an overall evaluation on WHAT
you have achieved and HOW you have demonstrated the 4 Nestle behaviors (Practice What
You Preach, Result Focus, Pro-active Co-operation & Initiative) in the execution of your
objective.
Your level of performance achieved will have direct impact on your salary review and Short
Term Bonus (STM).
PE has four phases.
Objective Settings (Jan-Feb); Performance objectives are set with the manager.
Interim Review (Jun-Aug); Review progress against objectives.
Calibration Meeting (Dec-Jan); Management meeting to ensure effective and equitable
performance evaluation across the organization.
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REMUNERATION
The Nestle Remuneration Policy states the major principles of our approach to remuneration,
which is guided by a sound balance between corporate as well as local responsibilities and
between the different remuneration elements. As well, it is based on, and aligned with, Nestle
Human Resources Policy.
The main objective of this Policy is to ensure that Nestle is able to attract and retain motivated
and high-performing employees through an equitable and coherent approach to Compensation
and Benefits within the Nestle Group. Remuneration Principles are influenced by various factors
such as competitive market practices, cost considerations; business results achieved both locally
and globally as well as the individual performance.
Similarly Nestle believes that there is a link between Performance and Pay.
Nestle believes in:
Recognize high performance
Manage low performance with integrity
Increase transparency and feedback
Career management as a partnership
An open and engaging work culture
Similarly Nestle has the policy that we all know that the PE tool is being used to drive and
evaluate the right performance
Lets understand what we mean by Pay-for-Performance. Planning, coaching, and evaluating
performance and then aligning rewards (pay) with performance outcomes. The short term
bonuses are also given to the employees according to the policy of the company.
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Continuous Improvement
IP ensure Continuous improvement of factory performance in terms of safety, quality, service,
performance, environment and cost savings. It also ensures the proper evaluation of the
improvement ideas, concerns related to them and their implementation & sustainability. IP also
facilitates & involves in the
Nestle Performance Teams (NPT) & Continuous Improvement Teams (CIT) which basically
works on the improvement projects with SMART objectives and effective outcomes. The
employees are also rewarded for their effective ideas. Top 10 ideas are given recognition and
they are given the some monitory and extrinsic rewards to boost up this activity. Last year
another employee recognition program was launched which was very successful in Nestle
Kabirwala Factory Limited as well.
Similarly other employee recognition ceremonies are also held annually quarterly and now
Nestle Kabirwala Factory Limited has launched these programs on monthly basis. The line
manager notices down the trouble handling of the workers. Similarly they notice that when and
how the worker handled the problem and how troubleshoot the problem. So it is proved to be
very effective.
The Factory Manager gives rewards to the recognized employee so this activity has proved very
helpful in increasing the morale of the employees.
INDUSTRIAL RELATIONS
A Nestl upholds the freedom of association of its employees and the effective recognition of the
right to collective bargaining. Nestl wishes, also through its relationship with unions another
representative association to sustain the long-term development of the Company, both to the
benefit of the employees and of the Company, by maintaining a level of competitiveness adapted
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EMPLOYEE RELATIONS
Is there a good relation between non-management and Management staff?
Yes, Nestle Pakistan has several regular team building activities involving all levels of
employees e.g. Sports Week, family day, cordial relationship with the employees union
&management.
Is there any level of interaction between management and non-management at work?
Yes, Nestle daily has the Operational Review Meetings in which issues are discussed and
corrective actions are taken after seeking concerned opinions and regulars visits of the plant by
the team leaders and the manager.
Do Nestle has the direct access to your Management Team to give spontaneous feedback?
Yes, Plant Manager can easily be accessed, apart from that, FM can also be approached, if needs
be. Management attends the shift handover and DOR that are also attended by the operators and
responds the queries of the participants.
Recognition
Is recognition really given to employees in Nestle Pakistan?
Yes, one recently launched by the Company "Maan Humara Tum Sa in addition to this, joint
birthday of staff, monthly lunch, hygiene trophy, CI Awards, Good Attendance Award.
Have employees been recognized for a good job (above average) you made?
Yes, if perform well:
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Financial Analysis
There are five types of financial statements which are used in the any company
Income Statement (Profit & Loss Statement)
Balance Sheet
Retained Earnings Statement
Statement of Owners Equity
Cash Flow Statement .
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Balance Sheet
A balance sheet shows the financial condition if an accounting entity as if a particular date. The
balance sheet consists of three major sections: assets, the resources of the firm; liabilities, the
debts of the firm; and stockholders equity, the owners interest in the firm. At any point in time,
the total amount of the assets must equal the total amount of the contributions of the creditors
and owners.
Assets = Liabilities + Stockholders equity
2013
2012
2011
Sales
86,227
79,088
64,824
Gross Profit
24,161
21,523
16,725
Operating Profit
11,471
10,966
8,458
8,113
7,978
6,503
5,867
5,865
4,668
Trading Results
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11,859
11,560
7,612
Reserves
11,406
11,107
7,159
31,468
21,882
16,089
4,767
(3,120)
(3,352)
22,429
19,351
10,821
28%
27%
26%
13%
14%
13%
7.8 : 1
7.7 : 1
8.2 : 1
1.7 : 1
7,550
1.8 : 1
4,733
2.2 : 1
3,597
68 : 32
69 : 31
69 : 31
1 :1
0.8 : 1
0.8 : 1
Net Current
Assets/Liabilities*
Long Term Liabilities*
Investor Information
- Current Ratio
Swot Analysis
Strength
Brand: One of the greatest strengths of nestle is its brand name and brand image in the local
Pakistani market. People trust nestle. They see nestle as a top priority product. Although the
price matters a lot for a customer but when the name comes of nestle, the customer is willing to
pay any amount for the products of nestle. So they have not only the increasing customer
demand but also the customer retention as well. Similarly the consumers taste is changing, the
consumer is more aware, and consumer gives lot of importance to the hygiene and Nestle has
positioned its products in the mind of consumers as top hygienic products. So it is also a great
strength.
Time Spent in market: Nestle has been serving its consumers since 140 years and it is a very
long time span. Similarly Nestle Pakistan has been serving Pakistan since so long. If we talk
about specifically Nestle Kabirwala Factory, it has also been become very experienced in the
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World Wide R&D: Research and Development is a key competitive advantage for Nestl.
Without our R&D Nestl could not have become the food industry leader in nutrition, health and
wellness. With 29 research, development and technology facilities worldwide, Nestl has the
largest R&D network of any food company. Nestls research, development and technology
network, together with local market application groups, employs over 5,000 people.
Weakness
Strong unionization: The increasing influence of unionization in Nestle
Kabirwala Factory has been the sign that employees have been lacking trust on
management. Therefore they are joining the unions. It can also be due to the
increasing job security, sense of having less benefits and not having competitive
salaries, so thee employees are joining union and want negotiations with the
management.
Communication problems and grapevine: Because the Nestle is a multinational
Company and it is serving in a market where the effective communication is very important to
gain the confidence of the employees. The people at Nestle Kabirwala Factory are very use to the
grapevine and therefore they immediately lose the confidence from the management without any
confirmation. So the management needs to get the people in confidence that it cares for its
employees as well.
Third Parties: One of the weaknesses of Nestle Kabirwala Factory is that it is relying on the
third parties in most of its operations. For example it has been working since so long but still it
has not focused on the forward integration and is completely relying on the distributors.
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Opportunities
Market Opportunities: The local market is not fully saturated and still there is a huge market that
can be captured by Nestle. Specifically talking about the Nestle Kabirwala Factory There are
substantial growth opportunities considering the average yield of Pakistani animals at only 1,100
liters/annum as compared to 6,000 liters/annum for animals in Europe and USA. There are nearly
20 million milk producing animals in the country, mostly in Punjab (80%).
The overall milk market in Pakistan is 20 billion liters; out of which processed milk contributes
only 3 million liters. Nestl MilkPak along with other processed milk businesses contributes only
2% to this large market. Nestl MilkPak has expanded its product range by entering the cold
dairy market recently by launching Nestl plain yogurt and now fruit yogurt is also added to it.
1. Competitors are also not there to serve the market which is not captured.
2. Nestle is only a food company but it can target other FMCGs as well similarly it can
diversity its products and become a conglomerate as well.
3. It can gain more supplier integration which has not been done yet. For this purpose nestle
has developed two model forms in Rinala and Sahiwal
With the name of Dairy Hub and Sursubz Form respectively.
For this purpose European breeds have been imported and are
given on easy installment to the farmers. The expertise are
provided free of cost.
4. Nestle can educate the supplier and for this purpose it has started
the project named UHTP in which lady livestock workers have
been given training from villages.
5. Nestle has been relying on two distributors in south Punjab. One is located in Multan and
other is in Bahawalpur. Nestle can go for forward integration as well.
6. As nestle has targeted upper and middle class consumers, it has the greater opportunity to
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Threats
Following can be the threats for Nestle Kabirwala Factory;
Too much dependence on third parties
As nestle has been very efficient in its operations but it is getting the services of the third parties.
So too much relying on the third parties can also be a threat for nestle. Because it involves so
many uncertainties. So it can be a threat for the company to rely many of its operations on the
third parties.
Limited distribution
Having a very limited number of the distributors and solely relying on them can also be a threat.
Because too much reliance on them may cause Nestle to lose of control and power over
distributor and high dependence on the distributors.
Uncertainty in economic condition in Pakistan
Price fluctuations due to rupee devaluation as raw material are imported.
The uncertainty of economic conditions poses a great threat as the major
funds invested in the country come from outside Pakistan.
Entry of new competitors
Market is growing and is attracting new competitors so the entry of new
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CONCLUSION
The period of my internship with such esteem organization like Nestle KBF
Pakistan was a great delight for me who enhanced my knowledge up to latest trends and bridged
the gap between theoretical knowledge and practical approaches being implemented in the
industry.
The learning environment was superb, just like an ocean where you come, take
what you want but there is no deficiency in that ocean. The safety & hygiene practices followed
at Nestle KBF are superb. There was no compromise on product quality.
Moreover, different HR departments such as Procurement, Employee Services,
Employee Relations, Industry Relations, Personnel Development, Trainings etc. are working
within their premises and they co-ordinate with each other for the overall effectiveness and
synergy creation. With their collective efforts, employees of the factory feel better.
Nestle Pakistan emphasize on the motivation of the employees, so employee are
motivated and work more efficiently. What I had learnt here is how to tackle the people who are
busy on their lines and how to get their attention towards us.
Beside the project I had learnt how nestle is working to delight their consumers and how nestle
keep the best quality product with low cost for the consumer.
Lastly, I would definitely say that working at Nestle KBF was a charm for me. I will always
remember these moments which I spent here. This was our best experience we ever had in our
life.
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