Taj Din Nirala Private Limited Introduction Nirala is Pakistan's leading multinational group - consisting of 10 rapidly growing companies and a vision of being the world's largest manufacturer of ethnic food. Our products range from Sweets, Snacks, Restaurants and Dairy products to Software. The innovative use of technology has played a pivotal role in the growth of the group as it has evolved from a single business to over 5 different businesses across 40 locations worldwide in the last three years. Our key strength remains investment in human resource and a strong focus on technology. Nirala foresees an even more aggressive growth path over the next five years and invites committed professionals to join its journey. Nirala Sweets, Pakistan's leading mithai (sweetmeats) manufacturers is pursuing a geographical expansion. The company has successfully launched a retail outlet outside its home city, where all the previous outlets were located. Many of the lessons learnt in that expansion are either forgotten, or many unknown factors emerge in the planned new project in Karachi. A new professional manager, hired by the company is sent to resolve the problems. The case allows students to see the many uncertainties that affect a new project as well as the importance and limitations of project planning. The case is intended for early use in a graduate course in Project Management or Management of Growth. 52 years ago Taj Din, migrated from India and laid the foundation of a dream so unique for its time that he choose to call it "Nirala". Over the years, his family has embraced the timeless traditional values of good taste and unmatched quality, by bringing you fresh mouth watering mathai so uniquely called Nirala! Today, proudly uphold the traditions of pioneer that have earned the love and loyalty of millions of customers all over the world. Nirala continue to make the happy moments of your life truly memorable and joyful and give you all the right reasons to stay in love with our irresistible temptation. History Over half a century ago, the foundation of Nirala was laid in Lahore, Pakistan, with the commitment to provide people with delectable quality delights. The great journey started when Taj Din migrated from Amritsar, India, to Lahore and started a small breakfast shop in the inner city of Lahore in 1948. The passion for quality, distinctiveness and hard work set by our founder is the spirit we seek as our guiding principle. Nirala family Over 50 years ago Taj Din, our founder introduced the best mithai the city of Lahore has ever known. Today, Taj Din's family strives to bring you the best of those age-old recipes. Taj Din: Taj Din founded this business more than half a century ago. It was his vision and entrepreneurial spirit that made Nirala a strong brand name in the Mithai business. His special emphasis on 'nothing but the best' ensured that the customer always found the same superior quality whenever he experienced any product of Nirala Sweets. Farooq Ahmad: Taj Din's son Farooq Ahmad, the Chairman of the Group, has been gifted with his father's vision and entrepreneurial spirit in his blood. It was he who took the shop out from the congested Fleming Road in the old city of Lahore and relocated to the more central and accessible area of Jail Road. He also paid special emphasis on shop environment and packaging design, besides of course the product quality. Faisal Farooq Farooq Ahmad's eldest son, Faisal Farooq was made CEO of the business by his father in 1997, at the young age of just 23 years, when Farooq Ahmad fell unwell and could not devote full time and attention to the business. Faisal courageously took about the challenge of growing the family business. With a dynamic approach and an MBA, Faisal kept adding more and more shops across the country and today has added new businesses to the establishment including a large milk processing and packaging plant, snacks plant and 2 restaurants, besides VCS (software house) and Porsche Pakistan, the dealership for the most sought after 'dream car' in the world! Ahmer Farooq Farooq Ahmad's younger son, Ahmer Farooq is a creative individual with an MBA and education in creative design from the UK. Besides heading the creative and communication side of the Group, Ahmer is actively involved in the Companies' day-today decision making. Omar Farooq and Fahad Farooq Farooq Ahmad's youngest sons, Omar and Fahad are twins and are still completing their education so that they when they join Nirala, they can add value to the business. Present of Nirala Sweets Companies The Nirala Group consists of ten companies operating in different market segments Anmol Company N Design N Restaurants Nirala Canada Ltd. Nirala Dairy (Pvt) Ltd. Nirala Snacks (Pvt) Ltd. Nirala (Pvt) Ltd. Nirala (UK) Ltd. Porsche Pakistan Taj Trading Anmol Company Anmol Company holds the exclusive franchise rights in Pakistan for Nirala Sweets & food products. Anmol Company is responsible for manufacturing, distributing and selling Nirala Sweets, which is undoubtedly the leading brand in the Mithai market in Pakistan. There is a wide range of products that the company has to offer. The brand has been built to this level over a period stretching beyond half a century. At the moment the Company has 39 shops; 37 in 9 cities of Pakistan and 2 abroad, in the UAE. N Design Nirala cares for nature and values art. The group contributes in designing elements by offering a wide range of designing services that include multimedia presentations, web sites, outdoor and press advertisements, modernistic décor for supermarkets and retail outlets and outputs for print media. These services are rendered to sister concerns and to other leading companies and multinationals operating in telecommunication, banking, oil and gas, and textile sectors etc. N Restaurants N Restaurant is another entity of the Nirala Group of Companies. When Taj Din established a sought after breakfast joint in the busy Mewa Mandi of Lahore way back in 1948, few would have imagined that more than 50 years later, his grandson will establish a classy restaurant in the busy and most posh locality of Lahore city, Defense Y Block. Ironically, the restaurant, by the name of Café Gowalmandi, is most famous today for the traditional breakfast served on weekends and all gazetted holidays. Having opened its first branch in September 2004, a second branch was added, in the busy St. Mary’s Park (Alfalah Mini Golf) in the latter part of 2005. Nirala Canada Ltd. The Company is being established to introduce Nirala Sweets and related products in the Canadian market. The core activity will include import of semi-finished products from Pakistan and to refine them at the semi kitchen established in Canada, before marketing the product at various stores. Semi kitchen will only be engaged in the refining of product or bringing them in marketable condition. Products will be marketed through a network of retail outlets around big business markets in Canada, like Toronto, Montreal, Ottawa, Vancouver and Calgary. The registered office of the company is located in Vancouver, British Columbia. Nirala Dairy (Pvt) Ltd. An integrated milk & milk powder processing plant has been set up at Tandlianwala, near Faisalabad, under the name of Nirala Dairy (Private) Limited. Nirala Doodh, the UHT packaged milk of the Company was launched in June 2005 and is now the favourite brand in many households. This is due to the strict quality measures that the Company religiously adheres to. Nirala Desi Ghee (Butter Oil) was launched earlier and is leading the market in its category due to is superior quality and taste. Many more products in the dairy range are being developed and will be launched shortly. Nirala Snacks (Pvt) Ltd. Nirala Snacks Pvt Ltd Our saltish range is one of the best and can be had with a cup of tea, coffee or a refreshing drink. An ideal snack prepared in natural oil to invigorate you and provide utmost fulfillment, our snacks range consists of Chips, Dal Masoor, Dal Safaid, Mongra, Namak Paray, Samosay (Potato and Chicken) and Sawaian, and are available across Pakistan from Nirala outlets as well as leading retail stores and supermarkets. Nirala (Pvt) Ltd. Nirala Private Limited is the custodian of the brand name Nirala. The brand is owned by this company and is a registered trade mark world over. Nirala (UK) Ltd. For United Kingdom & European Union, Nirala UK Limited holds the exclusive franchise rights of the Nirala brand. Under the franchise, it can set up Nirala shops, manufacture, sell and market Nirala products in its domain. Although Nirala UKLimitedis yet to open its first shop in the region, it is aspiring to capture the hearts of many sweets lovers in the region. Mission Statement To make Nirala a global brand, recognizable for uniqueness worldwide. To be an innovative and pioneer company continuously offering unique products and interesting service concepts others cannot even dream of. Vision Statement Our vision is to make Nirala a global brand, a brand recognizable for its uniqueness and quality in ethnic food market all around the worldwide. In this perceptive we consider our self as an innovative and a pioneer company, continuously offering unique products and interesting service concepts that others haven’t even dreamt of. Core Values The core values of our organization which we consider the Spirit of Nirala have not changed over the past half century. Those values and traditions which have made the brand Nirala a market leader for the past 59 years are: Continuous Improvement Innovation Integrity Team work and Social Responsibility Decision Making Defination: The process of selecting from several choices products or ideas, and taking action. Decision making is the cognitive process leading to the selection of a course of action among variations. Every decision making process produces a final choice. It can be an action or an opinion. It begins when we need to do something but we do not know what. Therefore, decision making is a reasoning process which can be rational or irrational, and can be based on explicit assumptions or tacit assumptions. Common examples include shopping, deciding what to eat, when to sleep, and deciding whom or what to vote for in an election or referendum. Decision making is said to be a psychological construct. This means that although we can never "see" a decision, we can infer from observable behavior that a decision has been made. Therefore, we conclude that a psychological event that we call "decision making" has occurred. It is a construction that imputes commitment to action. That is, based on observable actions, we assume that people have made a commitment to affect the action. Structured rational decision making is an important part of all science-based professions, where specialists apply their knowledge in a given area to making informed decisions. For example, medical decision making often involves making a diagnosis and selecting an appropriate treatment. Some research using naturalistic methods shows, however, that in situations with higher time pressure, higher stakes, or increased ambiguities, experts use intuitive decision making rather than structured approaches, following a recognition primed decision approach to fit a set of indicators into the expert's experience and immediately arrive at a satisfactory course of action without weighing alternatives. Also, recent robust decision efforts have formally integrated uncertainty into the decision making process. Decision making styles Strategic Structure All Nrala strategies are made by keeping in mind the mission statement of the organization, which clearly reflects the company’s objectives and goals. After deciding their task/objectives, they start analyzing the outside environment to analyze weather their strategies are applicable or not. If it is applicable then they start evaluating about opportunities and threats that they could face. After analyzing internal factors, management starts working on allocating, analyzing organization resources. When they allocate resources, they start finding specific areas where they look and point out their strengths. Then they summarized all the internal and extrernal data and decide how to execute their strategies. After having all the planning and collection of required data they start the execution of their plans and every single employee try its best to make it successful. And at the end the management starts evaluating the results either they are satisfactory or not. Structure of the Organization A key issue in accomplishing the goals identified in the planning process is structuring the work of the organization. Organizations are groups of people, with ideas and resources, working toward common goals. The purpose of the organizing function is to make the best use of the organization's resources to achieve organizational goals. Organizational structure is the formal decision-making framework by which job tasks are divided, grouped, and coordinated. Formalization is an important aspect of structure. It is the extent to which the units of the organization are explicitly defined and its policies, procedures, and goals are clearly stated. It is the official organizational structure conceived and built by top management. The formal organization can be seen and represented in chart form. An organization chart displays the organizational structure and shows job titles, lines of authority, and relationships between departments. The informal organization is the network, unrelated to the firm's formal authority structure, of social interactions among its employees. It is the personal and social relationships that arise spontaneously as people associate with one another in the work environment. The supervisor must realize that the informal organization affects the formal organization. The informal organizations can pressure group members to conform to the expectations of the informal group that conflict with those of the formal organization. This can result in the generation of false information or rumors and resistance to change desired by management. The supervisor should recognize the existence of information groups, identify the roles member play within these groups, and use knowledge of the groups to work effectively with them. The informal organization can make the formal organization more effective by providing support to management, stability to the environment, and useful communication channels. Even though the differences among organizations are enormous, there are many similarities that enable them to be classified. One widely used classification is the twofold system (mechanistic versus organic forms of organizational structure) developed by Tom Burns and G. M. Stalker in their study of electronics firms in the United Kingdom. (See Burns, Tom and G. M. Stalker, Management of Innovation, London: Tavistock Publications, 1961, p. 19.) The mechanistic structure is the traditional or classical design, common in many medium- and large-size organizations. Mechanistic organizations are somewhat rigid in that they consist of very clearly delineated jobs, have a well-defined hierarchical structure, and rely heavily on the formal chain of command for control. Bureaucratic organizations, with their emphasis on formalization, are the primary form of mechanistic structures. According to Max Weber, bureaucracy is a form of organization characterized by a rational, goal-directed hierarchy, impersonal decision making, formal controls, and subdivision into managerial positions and specialization of labor. Bureaucratic organizations are tall consisting of hierarchies with many levels of management. In a tall structure, people become relatively confined to their own area of specialization. Bureaucracies are driven by a top-down or command and control approach in which managers provide considerable direction and have considerable control over others. Other features of the bureaucratic organization include functional division of labor and work specialization. On the other hand, the organic structure is more flexible, more adaptable to a participative form of management, and less concerned with a clearly defined structure. The organic organization is open to the environment in order to capitalize upon new opportunities. Organic organizations have a flat structure with only one or two levels of management. Flat organizations emphasize a decentralized approach to management that encourage high employee involvement in decisions. The purpose of this structure is to create independent small businesses or enterprises that can rapidly respond to customers' needs or changes in the business environment. The supervisor tends to have a more personal relationship with his or her employees. Diagram: 1 GM OPERATIONS DGM OPERATIONS Quality Control Supply (Func.Sit) Semi kitchen Karachi & Dubai Sweets Production Finished Goods Store Packing Department Diagram: 2 GM GM Shop Operations Operation Manager Pakistan OPERATION MANAGER UAE Operation Manager UAE Operation Manager UK MANAGER Lahore Karachi ISL ISLAMABAD Dubai DUBAI IDubai Semi Sharjah GjIslamabad & Rawalpindi SIA Sialkot Peshawar Diagram: 3 M GM Marketing MARKETING GM MARKETING CUSTOMIZED CUSTOMIZED PACKAGING CREATIVE MARKETING SHOPS Customized Packaging Creative Department New Product Line Development Shops Marketing Web Marketing PRODUCT SERVICE PACKAGING Diagram: 4 GM GM Administration ADMINISTRATION HUMAN RESOURCE PROJECT Maintenance Diagram: 5 Manager Corporate Affairs CORPORATE TAX Tax Affairs L Legal Affairs Taj Din smiles again Managerial Hierarchy Top Managers Middle Managers First Line Managers Operatives Levels of Management Top Managers: Managers at or near the top level of management who are responsible for making the organization-wide decisions and establishing the goals and plans that affect the entire organization. Middle Managers: Managers between the first line level and the top level of the organization who manage the work of first line managers. They are bound to take orders from the top management and bound to implement them on lower level of managerial hierarchy. First line Mangers: They are at the third level of managerial Hierarchy. Managers at the lowest levels of the organization who manage the work of non managerial employees who are directly involved with the production or creation of the Organizations products. In other words they are also known as supervisors. Operatives: They are at lowest level of managerial Hierarchy. They are the workers who are assigned a specific task or a job to be done. They do not supervise any one and they obey the above managerial Hierarchy. Hierarchy of Organization CEO CEO MR. Faisal Farooq GM GM GM GM FINANCE CORPOR GM Operation Mr. Sohail Rana OP GM Shop.0peration Mr. Omer MR.OMER GM Marketing Mr.Saad Zahoor GM Administration Mr. Shahbaz MR SHAHBAZ Finance Manager M Mr. Azam MR.AZAM Corporate Affairs Mr. Hafiz Ishaq Culture of Organization What is Culture? Basically, organizational culture is the personality of the organization. Culture is comprised of the assumptions, values, norms and tangible signs (artifacts) of organization members and their behaviors. Members of an organization soon come to sense the particular culture of an organization. Culture is one of those terms that's difficult to express distinctly, but everyone knows it when they sense it. For example, the culture of a large, for-profit corporation is quite different than that of a hospital which is quite different that that of a university. You can tell the culture of an organization by looking at the arrangement of furniture, what they brag about, what members wear, etc. -- similar to what you can use to get a feeling about someone's personality. Corporate culture can be looked at as a system. Inputs include feedback from, e.g., society, professions, laws, stories, heroes, values on competition or service, etc. The process is based on our assumptions, values and norms, e.g., our values on money, time, facilities, space and people. Outputs or effects of our culture are, e.g., organizational behaviors, technologies, strategies, image, products, services, appearance, etc. The concept of culture is particularly important when attempting to manage organizationwide change. Practitioners are coming to realize that, despite the best-laid plans, organizational change must include not only changing structures and processes, but also changing the corporate culture as well. There's been a great deal of literature generated over the past decade about the concept of organizational culture -- particularly in regard to learning how to change organizational culture. Organizational change efforts are rumored to fail the vast majority of the time. Usually, this failure is credited to lack of understanding about the strong role of culture and the role it plays in organizations. That's one of the reasons that many strategic planners now place as much emphasis on identifying strategic values as they do mission and vision. Defination: Organizational culture, or corporate culture, comprises the attitudes, experiences, beliefs and values of an organization. It has been defined as "the specific collection of values and norms that are shared by people and groups in an organization and that control the way they interact with each other and with stakeholders outside the organization. Organizational values are beliefs and ideas about what kinds of goals members of an organization should pursue and ideas about the appropriate kinds or standards of behavior organizational members should use to achieve these goals. From organizational values develop organizational norms, guidelines or expectations that prescribe appropriate kinds of behavior by employees in particular situations and control the behavior of organizational members towards one another. Senior management may try to determine a corporate culture. They may wish to impose corporate values and standards of behavior that specifically reflect the objectives of the organization. In addition, there will also be an extant internal culture within the workforce. Work-groups within the organization have their own behavioral quirks and interactions which, to an extent, affect the whole system. Task culture can be imported. For example, computer technicians will have expertise, language and behaviors gained independently of the organization, but their presence can influence the culture of the organization as a whole. Strong / weak cultures: Strong culture is said to exist where staff respond to stimulus because of their alignment to organizational values. Conversely, there is weak culture where there is little alignment with organizational values and control must be exercised through extensive procedures and bureaucracy. Where culture is strong—people do things because they believe it is the right thing to do—there is a risk of another phenomenon, Groupthink. "Groupthink" was described by Irving L. Janis. He defined it as "...a quick and easy way to refer to a mode of thinking that people engage when they are deeply involved in a cohesive in-group, when members' strivings for unanimity override their motivation to realistically appraise alternatives of action." This is a state where people, even if they have different ideas, do not challenge organizational thinking, and therefore there is a reduced capacity for innovative thoughts. This could occur, for example, where there is heavy reliance on a central charismatic figure in the organization, or where there is an evangelical belief in the organization’s values, or also in groups where a friendly climate is at the base of their identity (avoidance of conflict). In fact groupthink is very common, it happens all the time, in almost every group. Members that are defiant are often turned down or seen as a negative influence by the rest of the group, because they bring conflict (conflicting ideas) and disturb the central culture. In cultural studies, culture is seen as ethnocentric (Barone, J.T, Switzer, J.Y), or culturocentric, meaning that we tend to think that our culture/subculture is the best. The stronger the culture, the greater the risks of groupthink. By contrast, bureaucratic organizations may miss opportunities for innovation, through reliance on established procedures. Innovative organizations need individuals who are prepared to challenge the status quo— be it groupthink or bureaucracy, and also need procedures to implement new ideas effectively. Leadership and how your people work together In looking at the family businesses' organizational culture, we are assessing behaviors that are important to creating a strong effective staff and competent leadership. Leadership In the organizational culture, leadership deals with creating a clearly articulated vision and possessing the skills and the resolve to recruit and develop followers who are committed to carrying out the vision. Having the ability to see the bigger picture and maintaining a balance between high-level strategies and front-line tactics. Different leadership styles are available depending upon concern for profit or concern for production. An imbalance in the concerns tends to sway the leader to a less effective style. Questionnaire from Employees Name: Profession: Culture of employees in Organization: 1. Is the environment Friendly? • Yes • No • May be Are you satisfied with the Hierarchal management of the company? • Yes • No • May be Are you satisfied? • Yes • No • May be How much work load is given to you? • Less • More • Burden Are you free to take decisions for challenges relation to you job description? • Yes • No • May be 2. 3. 4. 5. 6. Is the company providing you the fringe benefits? • Yes • No • May be What do you think about your job protection? • Yes • No • May be Do you feel convenient with the policies of the company relating to employees? • Yes • No • May be What are the criteria of job Selection? • Permanent • Contract basis 7. 8. 9. 10. What types of problems you face during the job? • • • • Financial Administration Over burden All the above Motivation and Reward Special Discount Given To Employees: On the marriage of any employee of Nirala, a gift of 10 kg sweets are given On EID 1kg sweet is given as free to each employee In RAMADAN, employee s is given free if tar party. Company beliefs according to team work: Team work, mutual trust and respect leads to personal growth and dynamic improvements in organizational team work. Team work shifts the culture of organization into a more productive atmosphere. They strongly believe on friendly environment. Effects of team work on company: Less duplication of work and rework. Improved morale Greater efficiencies in processes. Less office miscommunication. Greater profitability. Our Teams Shop Operations Quality Operations Marketing MIS Human Resource Finance & Accounts Administration Production Dairy Processing Stores & Procurement Shop Operations Nirala is the best opportunity to utilize my skills to the fullest potential' Muhammad Yasin Shahid National Sales Manger MBA - Quaid-i-Azam University Islamabad 'I have learnt and fulfill lots of challenges and feel proud to be an employee of Nirala!' Sidra Ghaffar Sales & Operations Coordinator B.Com Quality Operations 'It is exciting to see high quality standards at Nirala' Asifa Khalid Sr. Quality Assurance Manager MBA, Superior University, Lahore. 'I feel proud to work in House of taste with various products and contributed to export and new products rewarded by promotion coz Lag Gaya Na chaska.' Ayaz Khurram Sir R & D Executive M.Sc (Hons) Food Technology, University of Agriculture, Faisalabad. Marketing 'It’s Different, Its Nirala!' Saad Zahur Khan GM, Marketing & New Business Development MBA, LUMS - B.ARCH, NCA. ‘Everyday Is A Winding Road!' Sharjeel Hasan Assistant Brand Manager MBA, PCBA. MIS 'Each day brings with itself a fresh challenge - that is what keeps me going at Nirala!' Arsalan Ijaz Anwer Group Manager MIS & eCommerce BSc (Hons) Computer Science, LUMS. 'This place provokes an ' Irresistible temptation' to do better than the extraordinary!' Nabeel Akmal Qadeer Deputy Manager, MIS BSc (Hons) Computer Science, FAST-NU, Lahore. Imran Zarrar System Administrator MCS, University of South Asia, Lahore. 'Nirala helps me discover myself every day' Sumayya Zia Jr. System Analyst BSc (Hons) Computer Science, FAST-NU, Lahore 'Nirala, Nirala Hai!' Nadeem Shafiq Marketing Executive B.A. Human Resource 'Live a Nirala life' Usman Ghani HR Assistant MBA, Institute of Management Sciences. Finance & Accounts 'Youthful Nirala team is my source of motivation!' Muhamad Azam Adviser Account, Finance & Taxes Fellow Member, ICAP. 'Working with Nirala is sweaty and salty in a progressive group. Reduction in panic of tax and streamlining the tax matters. In the result of painful efforts favorable ITAT orders for NPL received and subsequently its publication reporting in Taxation Journals for future reference' Hafiz M.Ishaq Malik Manager Tax & Corporate Affairs C.A.(Finalist) – ICAP. 'Company's vision for a completely computerized environment motivates me to work with Nirala' Naveed Ahmad Chief Accountant ACCA Part II – UK. Administration 'Good working environment & above all a talented bunch of colleagues to work with' Shahbaz Ali Manager, Administration. Production 'My most memorable day at Nirala was when i got a car on achieving my Dairy target!' Sohail Rana GM, Production Operations MBA, College of Business Administration - Production Management Professional, PIQC. 'Working in Nirala means a lot to me, as this company has a history of more than half a decade!' M. Arif Head Karigar, (Laddoo) Working for over 19 years with Nirala. 'When Nirala launched its Dairy project, we all felt really honored and special' Adbul Sattar Head Karigar Working in Nirala for over 25 years. Dairy Processing 'Nirala is my life!' Muhammad Babar Riaz Project Manager, NDPL MBA, Institute of Leadership and Management Stores & Procurement 'I wish my life was as organized as … Nirala store!' Arif Nazir Asst. Manager, Stores Bsc, Faisalabad 'I love Nirala Stores' Haroon Iqbal Store Office Departments of the organization Departments Like any professional organization, the working at Nirala also follows a well planned organgram. The Nirala Group comprises of the following departments: Administration Finance & Accounts Human Resource Marketing Milk Procurement MIS Production Quality Assurance Retail Store Shop Operations Store & Procurement Supply & Distribution Administration Efficient management of all administrative affairs of Nirala Group of Companies is the job of the Administration department. From legal matters to general day-to-day operations of the office, the Administration department ensures that all affairs run smoothly. Finance & Accounts The Finance and Accounting departments at Nirala are responsible for the total financial management of the different businesses of the Group. From the usual accounting statements and sheets to risk and portfolio management, the team ensures that every rupee coming into and out of the Companies' pockets is properly documented and audited. Human Resource The Human Resource department at Nirala spearheads the recruitment process to ensure that the finest human resource is taken on board at Nirala. Resumes of candidates are carefully filed and documented for current or future reference. The department, besides carrying out succession planning, maintains and implements HR policies pertaining to employment, retention and superannuation. Assessing training needs of employees and ensuring adequate training is also carried out by the professional HR team at Nirala. Marketing Consisting of leading marketing professionals of the industry, who are graduates of top business schools of Pakistan, the Marketing Department ensures that from product need identification to product development, launch and post-launch, all strategic decisions are made based on authentic information and research. Identifying the target markets, effectively communicating to them and building the image of the brands as well as the Companies, is the job of the professionals running the marketing at Nirala. Milk Procurement As more than 90% of our food products are milk based, the entire Milk Procurement department plays a critical role in defining the quality of the end product that reaches our customers. Ensuring regular collection of fresh and pure milk right from the farmer to the factory and ascertaining the freshness of milk all across the milk procurement process, is the responsibility of Milk Procurement department, consisting of food technologists working at the collection centers and veterinary doctors providing service to the farmers. MIS The MIS department at Nirala ensures that all automation is running error-free at all times. Regularly modifying and updating the Company's accounting software is also the MIS team's responsibility. Production Modern technology is part and parcel of Production at Nirala. More than 20% of Mithai production at Nirala Sweets is carried out at automated plants, either imported from abroad or custom-made in the country. Fresh and crisp snacks products of Nirala Snacks (Pvt.) Ltd., are prepared and packaged on modern machines as well. As far as Nirala Dairy (Pvt.) Ltd., is concerned, the state-of-the-art plant set up at Tandlianwala near Faisalabad, has a processing capacity of more than 300,000 liters of milk per day, making it one of the largest in the country. Professionally qualified human resource efficiently works night and day to maintain highest hygiene standards. Quality Assurance Quality Assurance is strictly followed in all companies of Nirala Group. Be it Nirala Sweets, Nirala Dairy or Nirala Snacks, qualified food technologists at this department ensures that highest quality parameters are adhered to through all steps of production and that the products reach the consumers as per promise. Retail Store Whereas Shop Operations is the sales force of Nirala Sweets, the Retail Sales are responsible for the sale of all products of Nirala Dairy and Nirala Snacks at all leading retail outlets in the cities and towns where Nirala has entered. At the moment, Nirala Dairy and Nirala Snacks products are sold at more than 30000 retail shops across more than 50 cities of Pakistan. Shop Operations All operations of Nirala's 39 company managed outlets are run by the shop operations department. This department, in simpler terms, is the sales force of the business. It includes professionally trained front-line salesmen at the shops, experienced floor managers, and area managers, headed by a General Manager. Identifying strategically new locations and opening new shops is also done by this team. Store & Procurement The Stores & Procurement department working under Nirala Sweets is responsible primarily for procurement of all raw and packaging material and keeping its record for Nirala Sweets and Café Gowalmandi. Supply & Distribution This department falls under Nirala Sweets and ensures timely and effective distribution of the products to the chain of Nirala Sweets stores spread all across Pakistan. From transportation management to obtaining route permits and approvals, is done by this department. The BCG Matrix The BCG matrix The BCG matrix method is based on the product life cycle theory that can be used to determine what priorities should be given in the product portfolio of a business unit. To ensure long-term value creation, a company should have a portfolio of products that contains both high-growth products in need of cash inputs and low-growth products that generate a lot of cash. It has 2 dimensions: market share and market growth. The basic idea behind it is that the bigger the market share a product has or the faster the product's market grows the better it is for the company. Placing products in the BCG matrix results in 4 categories in a portfolio of a company: 1. Stars (=high growth, high market share) - use large amounts of cash and are leaders in the business so they should also generate large amounts of cash. - Frequently roughly in balance on net cash flow. However if needed any attempt should be made to hold share, because the rewards will be a cash cow if market share is kept. 2. Cash Cows (=low growth, high market share) - profits and cash generation should be high , and because of the low growth, investments needed should be low. Keep profits high - Foundation of a company. 3. Dogs (=low growth, low market share) - avoid and minimize the number of dogs in a company. - beware of expensive ‘turn around plans’. - deliver cash, otherwise liquidate. 4. Question Marks (= high growth, low market share) - have the worst cash characteristics of all, because high demands and low returns due to low market share - if nothing is done to change the market share, question marks will simply absorb great amounts of cash and later, as the growth stops, a dog. - Either invests heavily or sells off or invests nothing and generates whatever cash it can. Increase market share or deliver cash. BCG Matrix BCG Matrix 1. Stars (=high growth, high market share) Nirala UHT and SWEETS are the most well known and running products of Nirala Private Limited in the market. They give the best production and they have the most sales over the other products 2. Question Marks (= high growth, low market share) Nirala SWEETS and Nirala SNACKS are in the category of question marks because they have low market share but have high growth specially (sweets). After the production and sale of UHT sweets and snacks give the advantage to the Nirala Private Limited. 3. Cash Cows (=low growth, high market share) Nirala BEVERAGES are in the category of cash cows. They have less production and fewer sales in the market because the competitors of Nirala BEVERAGES are more and it is not well known in the market. 4. Dogs (=low growth, low market share) Nirala RESTAURANTS are in the category of dogs. They are not much published and are not well known among public because people prefer the well known RESTAURANTS but Nirala is working hard on their RESTAURANTS. Product Life Cycle The Product Life Cycle model can help analyzing Product and Industry Maturity Stages. Product Life Cy cle Industry Maturity Stages Product life Cycle Any Business is constantly seeking ways to grow future cash flows by maximizing revenue from the sale of products and services. Cash Flow allows a company to maintain viability, invest in new product development and improve its workforce; all in an effort to acquire additional market share and become a leader in its respective industry. A consistent and sustainable cash flow (revenue) stream from product sales is key to any long-term investment, and the best way to attain a stable revenue stream is a Cash Cow product, leading products that command a large market share in mature markets. Also, product life cycles are becoming shorter and shorter and many products in mature industries are revitalized by product differentiation and market segmentation. Organizations increasingly reassess product life cycle costs and revenues as the time available to sell a product and recover the investment in it shrink. Even as product life cycles shrink, the operating life of many products is lengthening. For example, the operating life of some durable goods, such as automobiles and appliances, has increased substantially. This leads the companies that produce these products to take their market life and service life into account when planning. Increasingly, companies are attempting to optimize life cycle revenue and profits through the consideration of product warranties, spare parts, and the ability to upgrade existing products. 4 Products of Organization There are a lot of products of Nirala private limited but we are only describing four of them: 1. Mithai 2. Snacks 3. Dairy 4. Beverages Mithai It all began in 1948 when the entrepreneurial Ustaad Taj Din migrated from Amritsar, India and started a breakfast joint in Mewa Mandi of Lahore. The uniqueness of the taste offered at the joint made it so popular that Taj Din soon decided to venture into Mithai as well, and opened a shop on Fleming Road in Lahore. The mithai tasted so different that he chose to call it Nirala … Today, over half a century after; the Nirala name has come a long way. Having won the trust and admiration of millions of customers across the nation, Nirala has also gone international with 2 shops in Dubai and Sharjah. Nirala Sweets is now all set to launch its operations in North America and UK soon. Today, Taj Din's family has evolved the business into an ever growing empire. Inducting experienced professionals in the team, Nirala has grown from a small Mithai vendor to 37 outlets in the country and 2 in the UAE. Nirala Sweets proudly offers more than a hundred varieties of Mithai to satisfy any taste. Our belief in 'nothing but the best' ensures that every experience with Nirala Sweets is as 'sweet and tasty' as ever and that quality is never compromised. Nirala Sweets is not just a name. It is a tradition, a trust and an integral part of your joyful memories. • • • • • Regular Mithai Special Mithai Sugar-free Mithai Cold Range Complete Range Snacks Our saltish range is one of the best and can be had with a cup of tea, coffee or a refreshing drink. An ideal snack prepared in natural oil to invigorate you and provide utmost fulfillment, our snacks range consists of Chips, Dal Masoor, Dal Safaid, Mongra, Namek Paray, Samosay (Potato and Chicken) and Sawaian, and are available across Pakistan from Nirala outlets as well as leading retail stores and supermarkets. • • • • • Nirala Snipz Nirala Snipz Torpedoz Nirala Khata’ees Nirala Pheonian Nirala Samosa Dairy An integrated milk & milk powder processing plant has been set up at Tandlianwala, near Faisalabad, under the name of Nirala Dairy (Private) Limited. Nirala Doodh, the UHT packaged milk of the Company was launched in June 2005 and is now the favourite brand in many households. This is due to the strict quality measures that the Company religiously adheres to. Nirala Desi Ghee (Butter Oil) was launched earlier and is leading the market in its category due to is superior quality and taste. Many more products in the dairy range are being developed and will be launched shortly. • • • Nirala Doodh Nirala Cream Desi Ghee Beverages At Nirala, we believe in consistent expansion of our product range as per the expectations of the modern consumer. Our beverages line is yet another addition to the wide range of products relished by our prestigious consumers. Rabri Milk: Traditional, cool and refreshing Lahori milk drink has been developed by Nirala Sweets to provide our valued consumers with yet another product they can savor. Enjoy the chilled, energetic and nourishing Rabri milk available at all Nirala Sweets outlets throughout the year. With low fats and a smooth-as-silk texture, our Rabri Milk is lighter on the stomach and is the ideal drink to refresh you on hot and humid afternoons. Bouncer: Nirala’s juice by the name of Bouncer is an exciting treat, yet nourishing and naturally fruitful. It is becoming fairly popular especially amongst kids because of its refreshing & energizing flavor. It is packed in a 6-layered Tetra Pack brick aseptic packaging. Nirala Pani: Living up to our legacy of invincible quality, we bring for you Nirala Pani, to refresh you anytime, any where. Future Products Company has aggressive plans to launch value added products. The dispensation competence of the products is relatively equivalent to large firms. Nirala will soon launch the consumer sale of following products. Powder Milk Nirala Butter Nirala Yogurt Nirala Swaiaan Future Plans of Nirala Sweets FUTURE PLANS • To promote Nirala diaries by offering its customers finest quality of UHT milk • To use the recognition to improve its operations. • The company plans to expand nationality with a wider presence in Pakistan as well as to expand its organizations in the Europe and United States. • They have planned to promote different products of nirala by offering free gifts to its customers with some products Porter 5 Forces Analysis Five Forces Analysis helps the marketer to contrast a competitive environment. It has similarities with other tools for environmental audit, such as PEST analysis, but tends to focus on the single, stand alone, business or SBU (Strategic Business Unit) rather than a single product or range of products. For example, Dell would analyze the market for Business Computers i.e. one of its SBUs. Five forces analysis looks at five key areas namely the threat of entry, the power of buyers, the power of suppliers, the threat of substitutes, and competitive rivalry. The Porter 5 forces analysis is a framework for industry analysis and business strategy development developed by Michael Porter in 1979. It uses concepts developed in Industrial Organization (IO) economics to derive 5 forces that determine the competitive intensity and therefore attractiveness of a market. Porter referred to these forces as the microenvironment, to contrast it with the more general term macro environment. They consist of those forces close to a company that affect its ability to serve its customers and make a profit. A change in any of the forces normally requires a company to re-assess the marketplace. The Porter’s 5 Forces tool is a simple but powerful tool for understanding where power lies in a business situation. This is useful, because it helps you understand both the strength of your current competitive position, and the strength of a position you’re looking to move into. With a clear understanding of where power lies, you can take fair advantage of a Situation of strength, improve a situation of weakness, and avoid taking wrong Steps. This makes it an important part of your planning toolkit. Conventionally, the tool is used to identify whether new products, services or businesses have the potential to be profitable. However it can be very illuminating when used to understand the balance of power in other situations too. Porter 5 forces Five Forces Four forces -- bargaining power of customers, the bargaining power of suppliers, the threat of new entrants, and the threat of substitute products -- combined with other variables to influence a fifth force, the level of competition in an industry. Each of these forces has several determinants: The threat of entry: Economies of scale e.g. the benefits associated with bulk purchasing. The high or low cost of entry e.g. how much wills it cost for the latest technology? Ease of access to distribution channels e.g. Do our competitors have the distribution channels sewn up? Cost advantages not related to the size of the company e.g. personal contacts or knowledge that larger companies do not own or learning curve effects. Will competitors retaliate? Government action e.g. will new laws be introduced that will weaken our competitive position? How important is differentiation? e.g. The Champagne brand cannot be copied. This desensitizes the influence of the environment. The power of buyers: This is high where there a few, large players in a market e.g. the large grocery chains. If there are a large number of undifferentiated, small suppliers e.g. small farming businesses supplying the large grocery chains? The cost of switching between suppliers is low e.g. from one fleet supplier of trucks to another. The power of suppliers: The power of suppliers tends to be a reversal of the power of buyers. Where the switching costs are high e.g. switching from one software supplier to another. Power is high where the brand is powerful e.g. Cadillac, Pizza Hut, Microsoft. There is a possibility of the supplier integrating forward e.g. Brewers buying bars. Customers are fragmented (not in clusters) so that they have little bargaining power e.g. Gas/Petrol stations in remote places. The threat of substitutes: Where there is product-for-product substitution e.g. email for fax where there is substitution of need e.g. better toothpaste reduces the need for dentists. Where there is generic substitution (competing for the currency in your pocket) e.g. Video suppliers compete with travel companies. We could always do without e.g. cigarettes. Competitive Rivalry This is most likely to be high where entry is likely; there is the threat of substitute products, and suppliers and buyers in the market attempt to control. This is why it is always seen in the center of the diagram. Number of competitors Rate of industry growth Intermittent industry overcapacity Exit barriers Diversity of competitors Informational complexity and asymmetry Brand equity Fixed cost allocation per value added Level of advertising expense Porter 5 Forces Analysis S.W.O.T Analysis S W O T = = = = Strengths Weaknesses Opportunities Threats SWOT analysis is a tool for auditing an organization and its environment. It is the first stage of planning and helps marketers to focus on key issues. SWOT stands for strengths, weaknesses, opportunities and threats. Strengths and weaknesses are internal factors. Opportunities and thr3eats are external factors. SWOT Analysis is a strategic planning tool used to evaluate the Strengths, Weaknesses, Opportunities, and Threats involved in a project or in a business venture. It involves specifying the objective of the business venture or project and identifying the internal and external factors that are favorable and unfavorable to achieving that objective The SWOT analysis is an extremely useful tool for understanding and decisionmaking for all sorts of situations in business and organizations. SWOT is an acronym for Strengths, Weaknesses, Opportunities, and Threats. Information about the origins and inventors of SWOT analysis is below. The SWOT analysis headings provide a good framework for reviewing strategy, position and direction of a company or business proposition, or any other idea. Completing a SWOT analysis is very simple, and is a good subject for workshop sessions. SWOT analysis also works well in brainstorming meetings. Use SWOT analysis for business planning, strategic planning, competitor evaluation, marketing, business and product development and research reports. S.W.O.T Analysis In SWOT, strengths and weaknesses are internal factors. Strength could be: Your specialist marketing expertise. A new, innovative product or service. Location of your business. Quality processes and procedures. Any other aspect of your business that adds value to your product or service. A weakness could be: Lack of marketing expertise. Undifferentiated products or services (i.e. in relation to your competitors). Location of your business. Poor quality goods or services. Damaged reputation. In SWOT, opportunities and threats are external factors. An opportunity could be: A developing market such as the Internet. Mergers, joint ventures or strategic alliances. Moving into new market segments that offer improved profits. A new international market. A market vacated by an ineffective competitor. A Threat could be: A new competitor in your home market. Price wars with competitors. A competitor has a new, innovative product or service. Competitors have superior access to channels of distribution. Taxation is introduced on your product or service. S.W.O.T Analysis of an Organization Strenghts: • • • • • • • Strong Brand Name. Due to mass production the cost is reduced and it helps maintain the financials on smooth flow. Company has their own setup/ it is the family business resulting into independent decision making. It enjoys approximately 30% market share, which is greater than any other company in this business. It has ISO 9001 quality assurance certificates in sweets lines or divisions. Its brand is widely acceptable as a symbol of quality. Company owned delivery vans for special occasions. Weaknesses: • • • • • • • • Cannot take small orders with reference to home delivery. NDPL (Nirala Diary Pvt Ltd.) & NSPL (Nirala Snacks Pvt Ltd.) still don’t have dedicated structure of management. Heavily financed by financial institutions. Lack of inter-departmental coordinations. The employee rewards/promotion process is inadequate. The selling price is out of the reach of consumers from low income group where the sweet consumption is relatively higher. No retention policy for the outstanding performers. They have not promoted their Restaurant even people are not aware; where the restaurant is located and to whom (Nirala) it belongs. Opportunities: • • Being one of the best mathai manufactures in Asia, the company has great opportunity in the export market in Middle East, Canada, UK and USA. NIRALA being the leader is far ahead from the competitors, there is no rival company with in the country that can match the market share and production capacity. By increasing the number of production facilities the sales volumes can be enhanced. • NIRALA is going into diversification by establishing restaurants, café, diary business, snacks, etc which will improve their business turnover and profitability. Threats: • • • • • Primary Competitors in sweet business like Gourmet bakers, Fazal Sweets, and secondary Shereen Mahal in addition of their growing branches. Products of other bakeries and Methai Shops are cheap. Taxation in advertisement is increasing the marketing cost hence, reducing the profits. Strong and established competition in Milk industry like CDL Foods and Nestle. In snacks they would be facing antagonism by companies like Tripple Emm and Saigol Foods Ltd. Conclusion Research is the key device to sort out that what problems an organization is facing in the existing market situations and to suggest the solution to these problems this research is conducted about the management structure of Nirala (pvt) Ltd, one of the most progressing company in Pakistan, which has experienced tremendous growth over the period of past ten years. Nirala is a distinguished brand in Pakistan. NIRALA claims that “we don’t compromise on quality”, and it is proved to be right, that is why it is growing day by day.