Nestle growth, both geographically and in product lines, prompted the company to introduce a new organizational structure to strengthen coordination and smooth communications between management, manufacturing and financial control functions. At the market level, coordination is established between a principal company, in a given region, and another company (or companies) in one or more neighboring markets. The principal company has a supervisory role over the other companies, which is delegated by central management.
4.1 Nestle Managing Networking
* Networking - In the world of computers, networking is the practice of linking two or more computing devices together for the purpose of sharing data. Networks are built with a mix of computer hardware and computer software (about.com)
Every organization of a size and strength of Nestle should constantly review and manage networking within organization in order to improve efficiency and corporate culture. Reasons why Nestle CEOs should consider strong networking solutions are as follows,
1. Sharing of technology resources
2. Sharing of data
3. Client/server systems
4. Enhanced communications
Hills Brothers is a coffee maker company acquired by Nestle, previously using dumb terminals, had decided to switch to personal computers (Harrington, 1991). While using dumb terminals, all companywide applications, including Nesnet - an international electronic-mail system that links all Nestle offices in the world via telephone lines, were called up through IBM’s Systems Network Architecture (SNA). Before completely switching to PCs, Nesnet and other internal order-processing systems were located on the mainframe. Shifting to PC is based on fact that it’s more cost-effective to keep information on a PC rather than “out-of-date minicomputer”, in line with a long-term strategy to move toward a companywide network within five years. After it was decided to combine Nestlé’s European coffee operations...