Thursday, April 26, 2012

Strategic Leadership and Ethics


Strategic Leadership started with Kellogg’s founder, W.K. Kellogg, back in 1906. Mr. Kellogg had a strong commitment to nutrition, health and quality and we still see these qualities being carried out today. His vision to drive improvement in Kellogg products and processes and produce the greatest tasting, nutritious products still continues, as well. By Mr. Kellogg being an inspirational and motivated founder, he set the tone in the company early. He pushed that their purpose was to “nourish families so they can flourish and thrive.” This has been driving Kellogg’s to success since the beginning.

Kellogg’s also shows strategic leadership by empowering employees. Kellogg’s employees are their competitive advantage. They have created a culture in which employees can succeed and grow in the company. Leadership believes that the company won’t succeed unless the employees succeed. They also empower their employees by recognizing their efforts with awards through out the year.

Internal knowledge is shared through out the company. I read through some of the employee biographies and this is what I learned. Employees enjoy working for Kellogg’s because they get to work in cross-functional teams, network to share and gain information, and that everyone is truly working towards the same goal.

Kellogg’s also uses external information to make decisions about products. Since they are a global company, they have to adjust their products to the tastes and preference of each culture. In order to find out what those consumers want, Kellogg’s listens to them and makes products that fit the different cultures. They have also listened to consumers when they said they wanted healthier foods. Kellogg’s has created the most nutritious foods to meet the needs of their consumers.

Ethics are a concern in every company, however Kellogg’s has created a Global Code of Ethics to promote ethical decision-making through out the company. Their 5 key points are integrity, trust, fair, accurate and respect. It states that Kellogg employees act with integrity and show respect for themselves, each other, consumers, customers, shareholders, communities and in the marketplace. They have an Ethics Office if ethical concerns arise and need to be discussed. Every year, employees are required to take a Business Conduct Questionnaire to reflect on personal circumstances and disclose any information about ethical misconduct.

http://files.shareholder.com/downloads/K/1701282836x0x148401/0FBF97EA-585E-4ADA-B9D5-2C49AE56491D/KelloggsCodeOfEthics.pdf

Thursday, April 19, 2012

Organizational Design



Kellogg Company’s organizational design is International Operations. The three major contingencies that influence structure adopted by Kellogg’s is the type of strategy driving their foreign operations, product diversity and the extent to which they are dependent on foreign sales. As I have mentioned in posts before, Kellogg’s manufactures their products in 18 different countries and sells their products in 180 countries. They also adapt their products to the culture of the country in which they are selling their products. Kellogg’s has a wide variety of products including cereal, pop tarts, breakfast bars, fruit snacks, chips and beverages. International sales account for 1/3 of their 2011 sales, which was $13.2 billion. Unfortunately, I could not find the exact numbers for their foreign sales.  http://www.annualreport2011.kelloggcompany.com/financial2.htm
















To manage their international operations, Kellogg’s uses a geographic-area division structure. A geographic-area division structure means that geographic regions group their operations internally. Kellogg’s uses this strategy because their foreign sales are a fair percentage of their total sales. 

Thursday, April 12, 2012

Corporate Responsibility


Kellogg’s puts out a Corporate Responsibility Report each year. It says on their Corporate Responsibility page on their website that they are, “committed to building a strong business while acting responsibly toward our customers and consumers, our employees, our communities and the environment.” Kellogg’s four key aspects are marketplace, workplace, environment and community. 
Marketplace includes producing great tasting foods that are safe, wholesome and high-quality. Kellogg’s is continually trying to improve the nutrition of their products. This section of their Corporate Responsibility Report contains information about nutrition and health, responsible marketing, labeling, product safety and quality, responsible sourcing, challenges Kellogg’s face, and where Kellogg’s is going. An award they won in 2010 is Canada’s “Most Trusted Brand of Breakfast Cereals.”

Workplace involves keeping employees their most important resource. This section of the Report contains labor standards, talent management, diversity and inclusion, employee safety, employee health, wellness and benefits, challenges they face, and where they are going. Since 2009, Kellogg’s has implemented a new leadership development program, established a new “total health management” program for all employees, and was named one of the “2011 Best Places to Work for LGBT Equality” by the Human Rights Campaign.

Environment involves Kellogg’s using natural resources to create their products. This section of the Report includes environmental management, energy and greenhouse gases, water, waste, sustainable packaging, sustainable agriculture, employee initiatives, challenges they face in this area and were they are going in the future in this area. Kellogg’s set two goals for 2015, which were to reduce their energy use, GHG emissions and water use by 15-20 percent and to continue to reduce their waste sent to landfill beyond the 51 percent already reduced since 2005. Kellogg’s surpassed these goals in 2010.

Community is being involved in the community and giving to charities that support communities. These charitable contributions are funded through the Kellogg Company and Kellogg’s Corporate Citizenship Fund, which is supervised by their Board of Directors and its Social Responsibility Committee. This section of the Report includes strategic philanthropy, breakfast programs, physical fitness, community development, disaster relief, challenges they face in this area and where they will being headed in the future in this are.

In 2010, Kellogg’s donated $32 million in cash and products to charitable organizations worldwide. The company donated food to food banks and distributed breakfast food to millions of schools across the globe. Kellogg’s also donated cash and products to assist with disaster relief efforts in Haiti, Chile and Japan.