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Organizational Structure of Nestle

Essay by   •  January 12, 2016  •  Case Study  •  6,156 Words (25 Pages)  •  4,669 Views

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Presented by: -                  Presented To: -         Aman Jaiswal                    Dr. Charu Choudhary                                                                   

Parul Garg

Aditya Mishra

Praveen Kumar

Anchala Srivastava

Shikhar Sexana

Navdeep Bhattanagar


IT gives us a great sense of pleasure after the completion of the assignment....for us it was not just an assignment in fact it is a sense of light that enlighted us in knowing something different. And the root credit of this is a simple lady but for us a great renounced name...


THANKS MA’AM, for your support...and sorry for any mistake if it is!!!

  • What is Organizational Structure?

Any operating organization should have its own structure in order to operate efficiently. For an organization, the organizational structure is a hierarchy of people and its functions. The organizational structure of an organization tells us the character of an organization and the values it believes in. Therefore, when we do business with an organization or getting into a new job in an organization, it is always a great idea to get to know and understand their organizational structure. Depending on the organizational values and the nature of the business, organizations tend to adopt one of the following structures for management purposes. Although the organization follows a particular structure, there can be departments and teams following some other organizational structure in exceptional cases. Sometimes, some organizations may follow a combination of the following organizational structures as well.

  • Types of Organizational Structure

Following are the types of organizational structures that can be observed in the modern business organizations.

Bureaucratic Structures

Bureaucratic structures maintain strict hierarchies when it comes to people management. There are three types of bureaucratic structures:

1) Pre-bureaucratic structures

This type of organizations lacks the standards. Usually this type of structure can be observed in small scale, start-up companies. Usually the structure is centralized and there is only one key decision maker. The communication is done in one-on-one conversations. This type of structures is quite helpful for small organizations due to the fact that the founder has the full control over all the decisions and operations.

2 - Bureaucratic structures

These structures have a certain degree of standardization. When the organizations grow complex and large, bureaucratic structures are required for management. These structures are quite suitable for tall organizations.

3 - Post-bureaucratic Structures

The organizations that follow post-bureaucratic structures still inherit the strict hierarchies, but open to more modern ideas and methodologies. They follow techniques such as total quality management (TQM), culture management, etc.

Functional Structure

The organization is divided into segments based on the functions when managing. This allows the organization to enhance the efficiencies of these functional groups. As an example, take a software company. Software engineers will only staff the entire software development department. This way, management of this functional group becomes easy and effective. Functional structures appear to be successful in large organization that produces high volumes of products at low costs. The low cost can be achieved by such companies due to the efficiencies within functional groups. In addition to such advantages, there can be disadvantage from an organizational perspective if the communication between the functional groups is not effective. In this case, organization may find it difficult to achieve some organizational objectives at the end.

[pic 2]

Divisional Structure

These types of organizations divide the functional areas of the organization to divisions. Each division is equipped with its own resources in order to function independently. There can be many bases to define divisions. Divisions can be defined based on the geographical basis, products/services basis, or any other measurement. As an example, take a company such as General Electric’s. It can have microwave division, turbine division, etc., and these divisions have their own marketing teams, finance teams, etc. In that sense, each division can be considered as a micro-company with the main organization.

Matrix Structure[pic 3]

When it comes to matrix structure, the organization places the employees based on the function and the product. The matrix structure gives the best of the both worlds of functional and divisional structures. In this type of an organization, the company uses teams to complete tasks. The teams are formed based on the functions they belong to (ex: software engineers) and product they are involved in (ex: Project A).This way, there are many teams in this organization such as software engineers of project A, software engineers of project B, QA engineers of project A, etc. project A, etc.

[pic 4]

  • What is Organizational Design?

Organizational design is the way in which we set up our business (employees, information and technologies) to best meet our business objectives. How we structure our organization has a major impact on how well it functions. There is no single best organizational design for all small businesses. Each business structure is as unique as the organization it represents. There are some key factors that we might consider when planning the design of our business:

  • Purpose: - What is the purpose of our business? Our first step is to clearly recognize what it is that we want to achieve. Think of the big picture. Take a step back and get a bird's eye view of your operation.
  • Strategy: - What strategy can we implement to reach our goal? We want our employees to make decisions based on clear guidelines directed to achieve our purpose. We need to have administrative systems; technology and information in place that will help our employees succeed.
  • Division of labour: - How can we divvy up employees' responsibilities to best meet our needs? Once we have determined the departments and roles that are needed to fulfil our purpose, we'll want to consider where to position our employees in order for them to thrive.
  • Authority, responsibility and control:-Once our departments are set and we have our employees in place, how will we structure our chain of command? Ultimately, there is only one boss — you. However, we will have to delegate decision-making responsibilities to department heads, managers, forepersons, etc. Be sure to limit our number of decision-makers. Employees should always be clear about their roles and responsibilities, and who their supervisor is.
  • Communication: - How can we best facilitate communication? It is vastly important that the entirety of our team is on the same page. When employees feel they are in the loop, they recognize that they are an important part of the organization. Communication is crucial to achieving our goals.
  • Coordination: - How will we coordinate employees, information and technologies? Job descriptions can help ensure our employees' understanding of their responsibilities. It is important for our team to understand exactly where they fit into our grand scheme. When planning our organizational design, it is essential to do our homework. Creating the blueprint for our business is not a decision to be taken lightly. We might take the time to find out how other businesses similar to ours are organized. As there isn't one clear-cut organizational model for all successful small- to medium-sized businesses, we'll want to analyze all of our options and decide how to tailor the best ones to work for us. Many business owners find it helpful to create an organizational chart. This will provide us, our employees and outsiders with a visual representation of the organizational roles and relationships. Internet search engines are a good place to discover a bevy of examples for creating your organizational chart.

  • Corporation, partnership, or sole proprietorship?

Find out which type of business structure is right for our business: incorporation, a partnership, a sole proprietorship or a co-operative.



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