The effectiveness of an FMCG Company’s employer branding practices: Can social media be used to generate better hires?

Abstract

Nestlé started its journey back in 1866 when Henry Nestlé created the world’s first effective breastmilk replacement formula. The organization has gone through two world wars and evens some major controversies during its 156 years of history, and is currently one of the leading Fast Moving Consumer Goods (FMCG) companies of the world. Nestlé has been operating in Bangladesh since the 1990’s, beginning as a joint venture in 1992 and being formalized as a wholly owned subsidiary in 1998, with its current headquarters located at Tejgaon Industrial Area, Dhaka. For nearly three decades, Nestlé Bangladesh Limited has been offering Bangladeshi consumers a diverse range of products across multiple segments, including dairy, coffee and beverages, instant food items, infant nutrition, breakfast cereals, and confectionary items. The company generally practices a democratic leadership style, where the decision-making process involves engaging with subordinates and taking their inputs and concerns into account. Among its employees, the company encourages a culture of learning, which is supported by a number of training and development initiatives focused on growing both soft and hard skills. As for recruiting said employees in the first place, Nestlé has separate hiring processes in place depending on whether they’re hiring interns, entry-level employees, or mid-level and upper level managers. The compensations structure generally follows a pay mix including base pay, allowances, incentives, as well as the incorporation of benefits such as insurance and PTO. While Nestlé’s marketing strategy and target customers are extremely diverse, given the diversity of product segments it operates in. In essence, almost everyone but the ultra-elite and the poverty-stricken are target customers of the company, and it uses whatever marketing strategy is relevant to each brand, product, and specific target segment. The company also has a track record of excellent advertising practices, and continues to win awards for them. Nestlé’s operations management structure is quite organized, with both the supply chain and distribution chain being segmented into appropriate functions. The company’s IT practices are however quite simple, and mostly include common documentation and communication tools from Microsoft. The organization operates in a moderately-highly competitive environment, and its global financial state is one that is heavily debt-leveraged but quite profitable. A dedicated platform is however used by the sales department for keeping track of sales, inventory, and distribution information. The FMCG sector that Nestlé operates in is one that is moderately high in terms of overall competition. While threat from new entrants is extremely low due to the high financial barrier to entry, threats from substitute goods and existing rivalry is quite high, along with supplier bargaining power, and bargaining power of customers is extremely high. Nestlé’s strengths mostly include brand image, infrastructure, and intellectual property, while weakness are mainly a controversial history and high costs. It has the opportunity to tap into new e-commerce marketplace, while facing the threat from increased competition. In the research project chapter, social media-based employer branding in the FMCG sector has been explored through a qualitative study. Although the existing body of literature suggest that employer branding should lead to higher employee performance and lower employee turnover, the findings of the study do not agree with this premise. The most likely causes behind the disagreement are theorized to either be a gap in the employer branding being implemented, or the existence of unobserved external factors. It is highly unlikely that the existing body of knowledge is flawed, since a wide range of authors agree on the premise, and as such, the issue with the results must lie elsewhere.