POM as understood by me

Here is the video stating my experience about "Principles of Organisation and Management".

Perfetti Van Melle

 

The company about which I am going to write below is Perfetti Van Melle. If you have not heard of the company then just look at the products below. All these products are manufactured under the brand name of Perfetti Van Melle.

Before I start with Perfetti Van Melle, please look at the video depicting the story of Perfetti Van Melle:

Its like gaining information "Salman Khan" (from The Khan Academy) way i.e. through videos.

Origin

Perfetti Van Melle is a privately held Italian global manufacturer of confectionery and gum. It was formed in 2001 with the acquisition of Van Melle of the Netherlands, by the Italian group Perfetti of Italy and having its corporate headquarters in Latinate (Milan), Italy.

Since the early eighties, Perfetti and Van Melle have maintained friendly business contacts. This friendship was strengthened when Perfetti acquires 37% of Van Melle shares in 1991. Perfetti and Van Melle decide to combine their activities and in March 2001, Perfetti purchased all Van Melle shares.

Perfetti Van Melle India, a fully owned subsidiary of  Perfetti Van Melle,started its Indian operations in 1994. In July 2006, Perfetti Van Melle acquired Chupa Chups, a family owned Spanish Group famous all over the world for its well-loved Chupa Chups and Smint brands. This acquisition reinforced the Group’s leadership position in the confectionery market, expanding its sales potential in mature and developing markets.

Perfetti Van Melle entered the Indian market in 1994 by offering its first brand Center Fresh, followed by Big Babol and Alpenliebe in 1995. The other brands like Chlormint, Mentos, Fruittella, Cofitos, Happydent and Marbles followed subsequently.

Vision

We will enhance our world leadership in confectionery by creating value for consumers through innovative and gratifying high-quality products.

Mission

We at Perfetti Van Melle will:

Develop, manufacture and market high-quality and innovative products for our consumers through the efficient use of our resources and in collaboration with our business partners; Create a fulfilling workplace for our employees built on trust, mutual respect, and appreciation of their  diversity; Value the role we play in our communities, as a socially and environmentally committed organization; Generate economic value through superior growth and profitability.

Products Perfetti Van Melle offers a wide range of products the popularity of which is rooted in individual, local and regional markets. Several of its brands are household names and are much-loved throughout the five continents. The products are divided in three categories: Snacks, Confectionery and Healthcare. Some of the products are listed below and lets have videos for the products.  1. Stop Not 2. Alpenliebe 3. Chlormint 4. Center Fresh 5. Mentos As you can see that all the advertisements have a humor quotient involved in it. The reason behind is that people connect with the ad if the things are presented in a way they like. For this reason Perfetti Van Melle gives utmost importance to such advertising. The advertising budget of Perfetti Van Melle reaches as high as Rs. 100crore. To create a seamless bridge between in-house marketing team and external partners, PVMI has recently created a media manager role within the company. Prasoon Joshi, executive chairman, McCann Erickson India says, "Not many clients have partnered us the way Perfetti has. At times we feel like suppliers to clients, but Perfetti has always made us feel that we are party to the brand's success." McCann handles advertising for Happydent, Alpenliebe, Chlor-mint and Big Babol among others. Perfetti has grown in India through its quirky and funny ads. Perfetti has mixed the communication with some funky taglines: Zubaan par rakhe lagaam (reins in the tongue) for Center Fresh, Kaisi jeebh laplapayi (how the tongue swirls) for Center Fruit, Dobara mat pooochchna (dare not ask again) for Chlor-Mint and Dimag ki batti jala de (lights up your brain) for Mentos. These are all expressions borrowed from everyday usage of the youth — the bulk of confectionery buyers are between four and 24 years. Market Share The Indian confectionery market is divided in three categories: Candies and toffees, gums (chewing gum and bubble gum) and mints. Perfetti's advantage is that it is the only company with products for each of the three categories. Thus, Mars strength is gums and Cadburys clairs and cough drops (it acquired Halls from Pfizer in 2003). Hershey, Parle Products and Lotte are strong in candies. ITC plays in the candy, clair and mint markets. Perfetti has a share of almost 20 per cent in candies with alpenliebe being the frontrunner. The brand has continued to lead the market with over 40% market share. Alpenlibe - In the year of launch (2001) become the market leader with 46% market share, while the category at large was de-growing. Over the last few years the brand has continued to lead the market with over 40% market share. The Brand was supported through above the line communication and simple activation, promotions etc. Perfetti  has a share of 55 per cent in the gum market with center fresh, center fruit, happyment leading the segment. In the mint segment perfetti has a share of 46% spearheaded by chlormint. Financial Performance Perfetti’s turnover has doubled to Rs 1,500 crore in the last three years. Three of its ten brands sell in excess of Rs 250 crore each (Alpenliebe, Centre Fresh and Big Babol), and two have crossed the Rs 100-crore mark, while a third is ready to join that club. When it comes to Perfetti Van Melle, the financial performance can be presented in the form of graph. Awards and Recognition PVMI brands have launched several innovative ad campaigns like Happydent White, Chlormint, Alpenliebe and Mentos which have won several awards for the company like the Abby for Protex Happydent & Centre Fresh, Cannes (Silver & Bronze) & Ad fest for Happydent White and Effie’s for Mentos. The "Palace" commercial swept all creative awards in India and bagged two awards at Cannes. Plants/ Manufacturing Units The Manufacturing processes of Perfetti Van Melle India Private Limited are carried out in the three manufacturing locations (Manesar Plant, Chennai Plant & Rudrapur Plant) with specific product ranges. SWOT analysis Strengths -   Strong Brand value  A wide variety of confectionaries and gums  Popular subsidiary brands like Alpenlibe, Big Babool, Chlormint, Center Fresh, Mentos, etc Strong distribution network An employee strength of about 17000 It has a global reach, operates in around 130 countries Effective marketing and advertising strategies for each of its subsidiary brands Attractive packaging and high product quality One of the largest confectionery maker globally.  Weakness -  Most of its products are targeted towards children except for chlormint like product, so limited consumer base Opportunities -  Reach out in the rural regions Bring newer flavors to attract more consumers Sponsor kids shows like reality contests, cartoon shows, etc. Growing economies results in more opportunities Use its established brand name to introduce new products like snacks, premium chocolates, biscuits, fruit juices, etc. Threats - Parents reluctant to buy chewing gums/bubble gums for kids. Competition from local and international brands.

Perfetti Van Melle is the leader in Indian confectionery market. It is because of the SMARTER goals set by the company. On the same lines, a team was created comprising of employees from various domain within the company to work together on the project of "Stop Not". Similar practices are integral part of Perfetti Van Melle wherein they motivate employees to put forth their ideas and work together in a team to launch a new product. So we can say Theory Y is prevalent in Perfetti Van melle.  

Three Monks (Chinese animated movie)

Three Monks is a Chinese animated feature film  produced by the Shanghai Animation Film Studio. It is also referred to as The Three Buddhist Priests. When the movie starts a note appears in which first column states "one monk fetches water to drink", the second column reads "two monks carry water to drink" and the third one just states, "three monks". To get a better understanding first let us watch the movie.

The movie can be divided into 3 parts:

1. When only one monk is there - We can see that when the monk was alone he used to do the work i.e. bringing the water from the river to the monastery happily. He had no qualms with the way things were moving. In other words he was content with the life he was living or the work he was doing.

2. When another monk joins the first one - The attitude of the first monk changes drastically when the second monk joins him in the monastery. Initially he intimidated him into bringing water from the river but after some time the newbie monk demand equal distribution of work. This altercation resulted in loss of man hours as well as gloomy atmosphere in the monastery. After lot of deliberation, they decide to share the responsibility and once they started sharing the job, their productivity also increased. We can see that the method adopted in this case is much better then used in the previous one. 

3. When the third monk joins the other two - Initially the same thing happened wherein the veterans forced the newcomer into work. After sometime it was total chaos in the monastery with none of the monks willing to go to the river to get the water. One fine day when fire breaks in the monastery then all the three monks work together in tandem thereby giving fruitful results. The method in this case is superior to the methods used in case 1 and case 2 as it involves active participation of all the resources.

Learning

The movie teaches us a lot of managerial lessons. I have listed down few of them:

1. Team work - The work which could have been done very easily had they worked as team took a toll on them. As we have seen in case of emergency (monastery catching fire), they worked as a team and got the desired results very easily. The manager has to ensure that the employees are working in a team, individuality hinders the progress of a firm. Team work can do wonders. In my last blog also I had shared a video on team work, this time have a look at this video:

2. Job distribution - The situation can be compared to an organisation which has all the resources in the world but is not able to utilise them properly. In the movie even with three monks (resources), water (end result)  was scarce in the monastery. It is responsibility of the manager to utilise the resources provided to him optimally. As we can see in the end the monks divides the job and get the desired result very effectively and easily. 

3. Innovation - There are two ways of completing a job, one is monotonous conventional method which every body follows and the other one being innovative method. In the movie the monks could have very well adopted conventional approach (three monks standing at regular intervals) to get the water, but it would have been very tiresome as well as time consuming. Thus they went for innovative idea of placing a pulley thereby reducing the mechanical effort one has to put in which in turn increased their productivity. In a company the manager has to be a Theory Y manager, always pushing the employees for new ideas, always having faith in the man power assigned to him. If the manager backs the employee then only employee can come out with a new and innovative idea. Innovation can be continuous (over a period of time), can be drastic (out of the exigency). The one which we had seen in the movie is drastic. But we should always aim for continuous innovation. If the innovation is continuous then it will be flawless because sufficient amount of time and thought process would have invested in that idea, whereas drastic innovations arises out of the emergency situation. 

What you have to say about this?

4. Crisis management - In the movie when the temple catches fire all the three monks work together as a team and gets out of the crisis situation. There are times when people looses their cool during emergencies. A manager must always keep a clam composure no matter what the situation is. In case of emergency, the manager should adopt a rationale thinking in getting the team of the emergency situation. He should be in a position to assign different employees in different roles so as to counter the exigencies.

An organisation can flourish only if it has cordial atmosphere as well as convivial employees. If the manager is able to bind the team together jovially, there is no stopping to the company. In the movie the same set of people were fighting against each other but circumstances changed them and the same set of people started working together and with increased productivity. The manager in a company must ensure that the employees are not dependent on emergency situation to come together and work as a team, they should work in coordination from the moment they join the team.