Topic analysis of promoting employees motivation through the compensation system in nestlé

Untitled Banking Academy of Vietnam International School of Business Subject Principles of management TOPIC ANALYSIS OF PROMOTING EMPLOYEES MOTIVATION THROUGH THE COMPENSATION SYSTEM IN NESTLÉ Lecture[.]

Banking Academy of Vietnam International School of Business

Subject: Principles of management TOPIC:

ANALYSIS OF PROMOTING EMPLOYEES MOTIVATION

THROUGH THE COMPENSATION SYSTEM IN NESTLÉ

Lecturer: MSc Nguyen Ngoc Mai

Class: CityU 10B Students:

Le Thi Ngoc Anh – CA10-032 Bui Thi Thuy Ngan – CA10-065 Nguyen Minh Ngoc – CA10-067 Tran Thi Tuyet – CA10-078 Nguyen Ngoc Khanh Van – CA10-016

Hanoi, 12 th

December, 2022

TABLE OF CONTENTS

ABSTRACT 1

CONTENT 2

I Overview of Nestlé 3

1 The process of formation and development .3

2 Mission .3

3 Business principles .3

4 Personnel characteristics .4

5 Business results 6

II Current status of Nestlé's compensation system 7

1 Financial compensation 8

1.1 Direct remuneration 8

1.2 Indirect remuneration 8

2 Non-financial compensation 8

2.1 Mental health and wellness 8

2.2 Career opportunities … 9

2.3 Learn and Share 9

3 Assess strengths and weaknesses .9

3.1 Strength 9

3.2 Weakness .11

III Proposed Solutions .11

1 Good management of the relationship between employees 11

2 Lessen employee’s work pressure 12

3 Lessons 12

3.1 Employee Motivation 12

3.2 Conflict resolution for businesses 15

CONCLUSION 17

REFERENCES 18

Science and technology are continually expanding in importance in today's world development trend However, human resources are never out of date, on the contrary, they have the ability to determine the future development path of each

enterprise As a result, each company must determine how to establish an appropriate remuneration system, thereby contributing to the enhancement of each individual's value

Nestlé is widely recognized as a global leader in the food and beverage

industries The company currently has a large production and sales network, with over

2000 brands present in 191 countries There are also 280,000 employees and 30,000 products It took a lot of effort to get to where you are now Recognizing this

distinction and breakthrough, our team selects the Research topic "Analysis of Nestlé's Compensation System." We propose specific solutions to maximize strengths and minimize weaknesses based on the situation, strengths, and points of weakness in Nestlé's policy system

We hope to receive your comments so that we can improve the essay due to our limited knowledge during the research process We sincerely thank you!

I OVERVIEW OF NESTLÉ FIRM

1 The process of formation and development

Nestlé Vietnam is a member of Nestlé Group operating in the field of food

Products Nestlé established a sales office in Vietnam in Saigon since 1916 In 1972, Nestlé built Dielac infant formula factory, this factory went into operation in 1975 (now managed by Vinamilk) Since 1990 Nestlé has been promoting the connection activities in Vietnam through the opening of a representative office in Ho Chi Minh City in 1993

1995: Established Nestlé Vietnam Co., Ltd., factory located in Bien Hoa 2

Industrial Park, Dong Nai

1996: Established Nestlé Vietnam Dairy Products Co., Ltd

2001: merging two companies into Nestlé Vietnam Co., Ltd under license

1152/GPDC10-BKH-KCN DN The main office is located at 41 Nguyen Thi Minh Khai, District 1, HCM In 2009, the company moved its headquarters to Etown

2013: Inaugurated Nestlé Tri An Factory specializing in the production of

NESCAFÉ

2018: Inaugurated the NESCAFÉ Dolce Gusto Tablet Production Line at Tri An factory

Up to now, Nestlé is operating 6 factories and more than 2812 employees

nationwide, with a total investment of more than 600 million USD by the end of 2019 With more than 120 distributors, Nestlé's 40 direct sales channels across provinces and cities, Nestlé products are present on a national scale

2 Mission

Nestlé global members share a common mission:

“Nestlé is the source of nutrition in your life, Your daily food, Good product quality deserves the value” (According to the global Nestlé strategic orientation)

The company's mission includes:

 It is critical and top priority to work closely with customers to meet their needs

in the field of food production

 It creates an inextricably linked organic relationship between human life and Nestlé products

 To foster that close relationship, Nestlé products must be of high quality and of comparable stature, this is also a significant advantage because Nestlé products are innovative and outperform competitors

 Sharing business profits with the development of people's lives in the country where the company operates

3 Business principles

Nestlé Vietnam actively builds a business culture close to Vietnam while following the global Nestlé culture and business principles Nestlé Vietnam commit to comply with the following business principles:

 Nestlé's business goals, as well as those of management and employees at all levels, are to produce and market the company's products in order to create value for consumers, shareholders, employees, business partners, and the many national economies in which Nestlé operates

 Nestlé does not advocate pursuing immediate profits at the expense of the company's long-term business development; the annual profit is used to

maintain financial market support and to finance investment projects

 Nestlé believes that oftentimes the law is the most effective tool to ensure ethical conduct, although in certain areas it is important to have additional guidance for management and employees in the form of voluntary business principles is extremely helpful to ensure that the highest standards are applied throughout the company

 Nestlé is aware that a corporation's success is a reflection of its qualifications, professionalism, behavior and ethical values of management and employees, so that the selection of appropriate staff and a policy of ongoing training and development are critical

 Nestlé recognizes that consumers have the right to be concerned about the company behind the Nestlé brand, as well as how the company operates

4 Personnel characteristics

High-quality staffs

Nestlé Global, the world's largest food and beverage corporation, and Nestlé

Vietnam, in particular, are formed by a team of high-quality, competent, hardworking, and professional-attitude employees These are people who have professional

knowledge and expertise in the field that Nestlé has carefully chosen from the

beginning Human resources are at the core of the business; they make a significant contribution to its success and enable it to grow sustainably

Not only that, but Nestlé employees are also regularly trained to adapt to the ever-changing economy and meet the requirements of high-quality human resources

Young and dynamic staff

Nestlé employees are typically young, active people who are willing to take risks and experiment with new things They have the skills, knowledge, and courage to become global citizens and represent the new economy The promotion and focus on recruiting young candidates show that Nestlé always creates opportunities for young people to have an environment in which to develop When there is a solid launch pad, which is Nestlé, the more effort they will make to break through and achieve the best outcomes Furthermore, this set of young employees will have the proper beliefs and attitudes toward the customer base that the corporation is aiming for, making it simpler

to come up with ideas that will strike a chord with the client This is also a two-way relationship that Nestlé wants to achieve

Culture of learning and cultivating

The culture of learning and cultivation is a highlight of Nestlé Vietnam's corporate culture Regardless of their starting points or positions, Nestlé Vietnam employees all have the same awareness of the importance of always learning to enhance their skills and knowledge The spirit of inquiry is a hue of Nestlé culture as well as a beauty in Vietnamese human traits

Cultural exchange

Nestlé has one HR feature that everyone wishes they had: a culture of sharing Employees will learn and share their experiences here Long-term employees will

learn from young people dynamism, new skills, and knowledge to keep up with the requirements of the era when e-commerce is developing strongly On the contrary, newbies will learn the fundamentals of the job from their predecessors, including how

to handle and operate instruments at work

Sharing experiences with each other not only helps employees develop more

comprehensively but also contributes to more open and close relationships Since then, the old and outdated concept among employees no longer exists in the working

environment All will work together based on common development, towards the goal

of bringing Nestlé closer to consumers

Diversity in human resources

In the new era, when humanity is trying to integrate, Nestlé is not out of that cycle The most obvious proof is that the personnel system here is extremely diverse No matter what country the branch is located in, there are always opportunities for

qualified and competent citizens from other countries

Employees at Nestlé Company come in a variety of ages Gender is also not a problem to address when both men and women, or LGBT, start at the same level and have equal prospects for advancement Many individuals arrive from many nations, each with their own religion When a person brings positive values to society, they deserve to be respected

With this feature, when working together, employees will use the common

language, English As a result, English is a crucial criterion to consider while hiring Employees will have more opportunities to learn from diverse cultures when working

in this environment, and the route to advancement will be more open

5 Business performance

Nestlé's bird's nest emblem has become recognizable to generations of Vietnamese customers among multinational corporations doing business in the Vietnamese market Nestlé Vietnam has been operating 4 factories in Vietnam since 1995, with a total investment capital of 730 million USD Businesses acquire 20-25% of Vietnam's total

coffee output each year to service production and export, providing around 700 million USD per year to the national economy

At the end of 2021, Nestlé Vietnam has excellently marked itself as the most

sustainable enterprise in Vietnam 2021 in the field of manufacturing Nestlé Vietnam has been named one of the top three most sustainable firms in Vietnam for the third year in a row According to the assessment of VCCI experts, Nestlé Vietnam has met the Sustainable Enterprise Index 2021 with 119 indicators including measures of business performance, indicators of governance processes, and environmental and social indicators

Mr Khuat Quang Hung, External Affairs Director of Nestlé Vietnam, stated at the Vietnam Circular Economy Forum 2022 that the Nestlé Plan 2030 has assisted in the replanting of 53 thousand hectares of old coffee trees, which equates to 53 million seedlings funded by Nestlé Coffee tree intercropping, as well as proper watering and fertilization, assist coffee gardens to boost output, improving farmer revenue

The quality of coffee beans has also increased since then, with the company now not only serving the home market but also exporting to 25 major countries across the world, including Korea, Japan, the United States, and Europe

II THE STATUS OF NESTLÉ'S COMPENSATION SYSTEM.

1 Financial treatment

1.1 Direct remuneration

Short-term or long-term salaries, bonuses, and additional benefits for employees are all at a high level

Base salary: This is the salary paid for the position and title the employee is

working for, and the employee is paid the base salary once a month The average Nestlé salary ranges from about $45,764 per year for a Microbiology Technician to

$307,314 per year for a Director Nestlé's average hourly wages range from about

$16 per hour for a Salesperson to $36 per hour for a Maintenance Worker

(According to Glassdoor.com statistics)

Annual cash bonus: 13th and 14th month salary bonuses are paid in December

every year, bonus according to business results  That means when employees do well, generate a lot of profit to help the company grow, the bonus they receive will increase accordingly This is one of the effective ways to motivate employees to work, increase their ability to contribute to the development of the company

1.2 Indirect remuneration

In addition to being entitled to all kinds of insurance as prescribed by law as in most other companies such as: Health insurance, social insurance, employees at the company are also entitled to health care regimes top health All NESTLÉ employees receive the Generali health insurance package - medical examination and treatment in high-class hospitals and clinics

In addition, the company also has many other benefits such as using Nestlé's

nutritional products for free at the factory, buying Nestlé products at a more favorable price than the market, using the company's transportation company All these policies are aimed at work-life balance

Besides, every year, apart from holidays and New Year, each Nestlé employee has the equivalent of 3 working weeks

In particular, Nestlé also has a maternity policy with at least 14 weeks of paid maternity leave and the right to extend the leave up to 6 months This policy helps protect employees' jobs, does not discriminate, protects health, provides flexible work options, and supports breastfeeding

2 Non-financial compensation

2.1 Take care of your health and spirit

Every year NESTLÉ organizes teambuilding activities and challenging sports activities such as Football Champion League These are programs that show team spirit and accept challenges of each NESTLÉ employee

NESTLÉ's office is designed to prioritize natural elements, making the office cool and comfortable for employees The company is also equipped with a lot of meeting

rooms, along with current facilities to effectively serve the work and rest time of

employees In addition, the dining area, sports area, and relaxation room are also arranged privately so that employees can rest when they need to re-energize

2.2 Career opportunities

NESTLÉ builds a clear career development path according to levels combined with a specific training program for each subject according to its own core values to promote the development of employees and empower them long-term learning opportunities

At NESTLÉ, they have specific training programs such as: Literacy training for

factory workers to increase labor productivity, maintain a positive working attitude, confident to argue; NESTLÉ apprenticeship training for trainees outside the company;

or Local training to meet high quality human resources

2.3 Learn and share

Continuous learning is a prominent part of NESTLÉ's culture Each member,

regardless of position, needs to constantly learn and improve their knowledge and skills The spirit of learning is considered an indispensable condition if you want to work at NESTLÉ Each employee here has the opportunity to improve themselves, open up opportunities for growth and advancement through continuous internal

training programs and consistent with work goals In addition to skills, professional knowledge, and competence, the principles: dynamic, practical, honest, hard-working and reliable are also the main criteria for each individual to have the opportunity to advance in the company

3 Assess strengths and weaknesses

3.1 Strengths

In order to better support and balance personal and professional lives, Nestlé is committed to offering its workers respectable working conditions, a safe and healthy work environment, and flexible employment Wherever possible, Nestlé encourages its employees to take part in extra community events and provides flexible working arrangements