Organizational Structure of Unilever
Write a Literature review on how Strategic Information System help organisations to achieve an alignment between the strategic goals of the organisation and the current and future IT infrastructure of the organisation.
The world is now considered very small sue to the impact of globalization. Organizations are now able to do their business in all over the world. This report focuses on the strategic role and analyzes the important information for an organization in order to operate the business in the in the competitive global market. Information system (IS) strategy and information technology (IT) strategy are important in an organization in order to operate the business effectively. For the discussion, company Unilever is selected. Unilever is the Dutch-British multinational company which has wide range of consumer product brands i.e. beverages, food items, cleaning agents and personal care products. The company has two headquarter, one is in Rotterdam Netherland and other is in London UK. Unilever is dual listed company which is operated effectively (Unilever, 2017).
The corporate structure is responsible for the proper support of product innovation in the company’s global business. The organizational structure of Unilever adapts various changes in the global market and consumer goods industry. The company has organizational structure that supports the business operations at the global level. The organizational structure of Unilever is product type divisional structure. For instance, the company has division for personal care products and division of other home care products.
Figure 1: Organizational Structure
(Source: Unilever, 2017)
Unilever includes wide range of brands of products for the customers. Unilever includes billion-euro brands, food and beverage, ice-cream and home and personal brands. Unilever is world’s biggest food and beverage and biggest ice cream manufacture having annual turnover of €5 billion. The company has more than 400 brands which are organized into four basic catagories i.e. refreshments, foods, Home care and personal care. Current largest selling brand of Unilever are Dove, Heartbrand, Knorr, Lux, Rexona, Vesline and VO5 (Unilever, 2017).
Figure 2: Product Range
(Source: Unilever, (2017)
Business unit is the segment of a company that represents specific business function. The company has various business units and every unit has responsibility towards profit generation. The business unit of the company is divided into production unit, accounting team and marketing unit and so on. All of these functional units contribute to enhance the profit level of the company as business functions focus on each and every set of products. In case of Unilever, groups of various products under a single brand are sold by the company which is known as product line. Unilever have various business units along with multiple product lines. The business units of the company are broadly classified into two groups i.e. sales and production. Further, there are four major units of the company including personal care, food, home care and refreshments. The key operations of Unilever are discussed below:
The operations and functions of Unilever focus on the product development process. The success is achieved by the continuous innovations by addressing customers’ expectations. By the marketing mix, Unilever creates complex set of needs with the high variety of consumer goods. The operational requirements are based on the productivity and process in order to support development and production of the products (Liu & Jiang, 2011).
Product Range
In this area, operations managers of the company deal with the expectations of the customers and product quality in order to satisfy them. The approach of Unilever includes implementing quality standards in the operational process to meet the quality requirements in the products. The operations management standards are achieved by the market research data of the company. In order to maintain high quality in the product, corporate as well as local standards are applied in some product lines (Sashi, 2012).
The operations management focuses on the sufficiency of the human resources in order to support business operations. The operational efforts in this area ensure job designs and corporate culture for supporting productivity and enhancing business performance. By effective human resources, the operations managers directly impact on human resource capacity and financial performance of the company in the market.
The supply chain process of Unilever is extensively automated. In the company, managers always focus on the decision based on the variations in the supply and demand of the products by the target customers. Minimal time is taken in the information flow among the parties in the supply chain due to online data base. The supply chain of Unilever is maintained by regular monitoring and active problem solving process (Festus & Xiaoming, 2010).
Unilever is a successful company having wide range of products and effective business. But there are some issues in the business and those issues have significant impact on the business operations. Some business related issues are described below:
Unilever is operating in highly competitive environment in which various established companies like Tesco, Sainsbury and Marrison’s. So, it is not easy to manage the relations with the customers. Changed tastes and preferences are challenging for the company and it is not easy for Unilever to interact with the customers. Company has faced issue issues in using palm oil that affected the business of Unilever. Further, Unilever need a proper system in order understand the needs and requirements if the customers. The company is less connected of its customers directly. Further, the company does not have any premium market.
Unilever is facing issues related to supply chain practices as the company has wide range of products. It is not easy to keep record of all the products and it is also not easy to provide the products to the customers on time. With effective supply chain practices in the business operations, company will not be able to get success and profit in the market. Company can also face economic loss in the business due to improper supply chain activities. So, there is the need to adopt an effective system strategy for the proper supply chain process in Unilever (Grean & Shaw, 2010).
Strategic level
In order to get effectiveness in the inbound logistics operations, the information requirement for the Unilever will be needed. By the strategic level information, company will be able to keep a good control over the needs and requirements and storage of the material. Along with this, information system can be helpful for Unilever in order to improve the process of outbound logistics including, controlling, collecting and reviewing the overall logistics system. An information system strategy includes the review of physical distribution channels so that the orders of the customers can be delivered quickly.
Business Units
In case of Unilever, the use of Decision Support System or DSS can be helpful in the integration of various logistics activities. By this information system, most cost effective and strategically beneficial decisions can be taken by the company. By this manner, unnecessary delays can be avoided effectively (Turban & Volonino, 2012).
Tactical level
Information system includes easy procurement process which can helpful for the company to send direct quotations in various departments related to the suppliers and select the beast deal out of them. By adopting this way, the alignment in the purchasing process of raw material can be achieved effectively. At the tactical level, the information system can be used by the company. The employee resource planning system of ERP system can be used by Unilever in order to deal with the issues of supply chain in the company (Mithas & Sambamurthy, 2011).
In order to get benefits from supply chain, company must adopt ‘hub-and-spoke’ system. Company will be able to centralize the products in the warehouses. Along with this, company can also use management system of inventory in order to manage raw material. This will be helpful for the company to provide the products to the customers on time in the fastest way. Unilever can also introduce the system named point of sales (POS) system which will control the fast delivery of consumer goods. Unilever can also use EDI system of procurement. EDI system can be helpful to increase the efficiency of Unilever in terms of B2B business (Yu et al, 2013).
Knowledge level
Next, information system can be helpful for Unilever in order to support human resource management in various countries. By this way, company will be able to manage human resource processes like training, recruitment and development etc. Unilever is currently operating in 190 countries so, it is important for the company to have skilled and knowledge people to operate the business.
For supporting HRM activities, management information system of MIS will be very helpful. This system is very useful in order to collect and analyze the management related information like number of employees in the company, raising absenteeism rate of employees, requirement of training and number of employees seeking for promotion etc. by this way, information system is helpful to get easy access of the information and this could be helpful for various human resource related activities (David & David, 2016).
Operational level
The information system can also be helpful for Unilever in various operations in different countries. By the use of information system, the manufacturing and production capacities of the company can be improved. With the help of improvement information management system like CRM, the consumption time and wastage can be decreased. Along with this, effective information system can also be helpful for Unilever in order to maintain strong customer relations by meeting their needs and requirements on the time. By this way, company will get loyal customers as they will continue to prefer purchases of the products and services. Further, information system can also be supportive in various business related activities of Unilever by providing after sales services and by adding their email id and contacts with the high officials (Shroff, Verdi & Yu, 2013).
Operation Processes
With all the advantages and benefits, Unilever can be confident on its success. But there are some challenges and difficulties in the information system which can be faced by the company while implementing this in its business operations. There are some drawbacks in the current information system strategy of Unilever. First thing is that there are some risks while implementing information system such as EDI system. In order to implement these systems, various multinational companies need to set global standards at some level. EDI is selected to enhance the efficiency of the supply chain activities in the business but it can set up new problems for the company. There can be technological issues in the performance of the tag. There are some problems which are needed to be solved by Unilever as small problems can create big issues in future (Watson, 2007). Company may face difficulties in developing CRM and MIS software as new employees are not aware about new systems. Along with this, there is the need of lots of time and money to implement new information systems in the business.
There can some problems while implementing the information system in the business operations. Although information is becoming one of the most valuable assets in the modern organizations but the development of information system has various issues and problems. Among the problems, most important are low productivity, a large number of failures and insufficient alignment of information system with the business requirements. First problem is low productivity which can be faced by Unilever in the business operations. The low productivity indicates by the maintenance problem and backlog. Basically, the demands of the new information software have increased faster as compared to the ability to develop this (Galliers & Leidner, 2014).
The development of information system has number of failures. These failures can be due to some economic mismatches like overruns of budget, poor product quality and insufficient user satisfaction. According to one survey, 75% of information system developments undertaken were never completed and those were never used. Further, in business point of view, there is the growing criticism of poor alignment of business requirements and information system. The resources of the organization are spent on searching, refining and analyzing the information and the connection between organizational strategies and performance and Information system is to be uncertain (Bloom, 2014). For example, most of the users and mangers are facing problems when they cannot get information for operating their business. So, Information system is challenged by the dynamic nature of business.
It is recommended that for implementing the information system effectively, organization should adopt protocols, guidelines, codes and standards. A proper planning should be done with the cooperation of partners which is the key point of success of new information system. Further, by focusing on strategic, tactical and operational level information system strategy, Unilever should implement new information system strategy in the business.
Conclusion
This report discusses about the role of information system in the organization. There are various companies using information system in order to operate the business effectively. With the information system, employees of the company will feel relaxed as information system is helpful in reducing their workload in the business operations. In case of Unilever, company has to face some difficulties while implementing the information system strategy. But, with the help of information system, Unilever will be able to operate in the competitive world.
References
Bloom, N., (2014), The distinct effects of information technology and communication technology on firm organization: Management Science, 60(12), pp.2859-2885
David, F., & David, F.R., (2016), Strategic Management: A Competitive Advantage Approach, Concepts and Cases
Festus, O., & Xiaoming Li., (2010), “Information sharing and collaboration practices in reverse logistics”, Supply Chain Management: An International Journal, 15(6), pp. 454 – 462
Galliers, R. D., & Leidner, D. E., (2014), Strategic information management: challenges and strategies in managing information systems, Routledge
Grean, M., & Shaw, J.M., (2010), Supply-Chain Integration through Information Sharing: Channel Partnership between Wal-Mart and Procter & Gamble
Liu, S., & Jiang, M., (2011), Providing Efficient Decision Support for Green Operations Management: An Integrated Perspective, INTECH
Mithas, S. and Sambamurthy, V., (2011), How information management capability influences firm performance: MIS quarterly, 35(1), pp.237
Sashi, C.M., (2012), Customer engagement, buyer-seller relationships, and social media. Management decision, 50(2), pp.253-272
Shroff, N., Verdi, R.S. and Yu, G., (2013), Information environment and the investment decisions of multinational corporations: The Accounting Review, 89(2), pp.759-790
Turban, E., & Volonino, L., (2012), Information Technology for Management, (8th), John Wiley & sons Inc
Unilever, (2017), Our brands, accessed on 28th December 2017 from https://www.unilever.com/brands/
Unilever, (2017), Sustainable growth, accessed on 28th December 2017 from https://www.unilever.com/
Watson, R. T., (2007), Information Systems, accessed on 28th December 2017 from file:///C:/Users/Guest/Downloads/InformationSystemsIS_Book.pdf
Yu, Y., Hong, Z. F., Zhang, L., Liang,L., & Chu,C. B., (2013), Optimal selection of retailers for a manufacturing vendor in a vendor managed inventory system: European Journal of Operational Research, 225(2), pp 273–284
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