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ACKNOWLEGEMENT

Words will never be able to express enough our feverent gratitude to almighty Allah,
the most compassionate and merciful, for giving us the courage and fortitude to
accomplish this gargantuan task. We are the Holy Prophet’s Ummah (PBUH) and we
acknowledged that the Holy Prophet’s (PBUH) moral and spiritual teachings have
enlightened our heart and mind and have guided our thoughts towards new horizons
enriched with great ideas of life.

We are undoubtedly indebted to Sir Mubassher at Superior University, Faiza

Maqbool (Organizational Development Executive) and Javeria Khan (Human
Resource Executive) at Tetra Pak Pakistan Ltd. who have been our mentors and
thanks for their kind supervision, valuable suggestions and moral support through out
our research. We are highly impressed by intellectual activities and inexhaustible
energies used in steering forth the students.

We must take this opportunity to appreciate efforts and co-operation of our fellow’s
students and friends whose constructive suggestions have made possible for us to
conduct this project. We extend our thanks to all of them for there helping hand
whenever needed. Once again words fail in expressing our thanks to our families,
whose hands are always raised in prayers for our success.

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 TABLE OF CONTENTS

TOPICS
1 Introduction
2 Historical Background
3 Tetra Pak – an update
4 Tetra Pak – our motto
5 Tetra Pak – rules of their journey
6 Future Outlook
7 ISO – 9001 Certification
8 Tetra Pak – Benefits
(I) Protection
(II) Preservation
(III) Communication
(IV) Convenience
9 Situation Analysis
(a) General Environment
(i) General State Of The Economy
(ii) Economic Situation Of The Industry
(iii) Situation Of Company In The Industry
(b) Product Market
(i) Sales Volume
(ii) Growth Rate
(iii) Market Share
(c) Customer Market
(i) Demographic Factors
(ii) Life Style Pattern
(iii) Usage Pattern And Behavior
(iv) Preference For Specific Benefits
(d) Marketing Programs
(i) Advertising And Promotional Programs
 Television
 Newspapers And Magazines
(ii) Relationship With Dealers, Wholesalers And Retailers
10 Consumer Research

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11 Innovation And Flexibility
12 Organizational Culture
(i) Strong Culture
(ii) Weak Culture
(iii) Tetra Pak’s Culture
(iv) Dimensions Of Tetra Pak’s Culture
 Attention To Detail
 Outcome Orientation
 People Orientation
 Team Orientation
 Aggressiveness
 Stability
 Innovation And Risk Taking

(v) How People Learn Culture OF Tetra Pak

 Stories
 Rituals
 Press Conference
 Follow Up Campaigns
 Customers Campaigns
 Outdoor Support Campaigns
 Boarding
 Arranging Seminars And Functions
 Material Symbols
 Language
13 Environment
14 Tetra Pak’s Environment Policy
15 Managing The Environment
(i) Design
(ii) Supplier Management
(iii) Sustainable Forestry Management
16 Specific Environment
(i) Costumer Or Products
(ii) Suppliers
(iii) Pressure Groups
(iv) Competitors
17 General Environment
(i) Culture And Social Environment

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(ii) Economic And Technological Environment
(iii) Political And Legal Environment
(iv) Competitive Environment
(v) Political Conditions
(vi) Demographic Environment
(vii) Global Environment
(viii) Ecological Environment
18 Level Of Social Responsibility
(i) Classical view
(ii) Socio Economic View
 Recycling
 Food For Development
 An Urgent Need
 New Feeding Programmer Initiatives
19 The “Greening” Of Management
20 Managerial Ethics
(i) Utilitarian View OF Ethics
(ii) Right View Of Ethics
(iii) Theory Of Justice View Of Ethics
 Core Values
 Freedom With Accountability
 Partnership With Customers, Suppliers And
Colleagues
 Long Term Perspective
 Innovation And Creativity
 Communication And Fun
22 Packaging
23 Product Example
24 Planning Process
25 Approaches To Establish Goals
26 Business strategy
27 Planning Tools And Techniques
(i) Environmental Scanning
 Competitor Intelligence
 Global Scanning
(ii) Forecasting
 Quantitative Forecasting
 Qualitative Forecasting

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(iii) Benchmarking

28 Technique For Allocating Resources

(i) Budgeting
Tetra Pak Budgeted Sales – 2004
29 Organizational Structure
(i) Work Specialization
(ii) Departmentalization
(iii) Chain Of Command
(iv) Decentralization
(v) Formalization
30 Organizational Design
(i) Organic Organization
31 Employee’s Motivation
(i) Herzberg’s Motivation – Hygiene Theory
(ii) Three – Needs Theory
32 Leadership
(i) Democratic Style
33 Control Processes
(i) Feed Forward Control
(ii) Concurrent Control
34 The BCG Matrix
35 Bibliography
36 Conclusion

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 1. Introduction
Tetra Pak is the quite old and most trusted packaging company of Pakistan. Starting its
operations in 1982, the company has grown from strength to strength over the last 21
years. Packaging of a high standard of products are enriching the lives of millions with
all the goodness of nature for a healthy lifestyle.

Today, the Tetra Pak continues to grow. It is reaching to more and more companies for
packaging with the passage of time. This means that Tetra Pak's customers enjoy the
advantage of being able to get multi-product solutions from a single source, with
matching equipment at every stage.

2. Historical Background
Tetra Pak is a Swedish industrial company. It was founded in 1951 in Lund, Sweden
by Ruben Rausing and Erik Wallenberg.

Tetra Pak's first product was a revolutionary paper carton used for storing and
transporting milk. Rausing had been working on the design since 1943, and by 1950
had perfected techniques for making his cartons fully airtight, using a system of plastic
coated paperboard. These initial cartons were tetrahedrons, leading to the company's
name. In 1963 the company introduced Tetra Brik, a rectangular carton.

Ruben Rausing's son Hans ran Tetra Pak from 1954 until 1985, taking the company
from a seven-person concern to one of Sweden's largest corporations. Before his death
in 1983, Ruben Rausing was Sweden's richest person.

Tetra Pak is the world's largest supplier of cartons and bottles for milk, soup, fruit
juices, and other liquid products, and the company also manufactures machinery used
for food packaging. In 2002 it employed over 20,000 people.

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 In Pakistan, Tetra Pak started its operation in 1982.

3. Tetr
a
Pak
– An

Update
Tetra Pak develops, manufactures and sells complete systems for the processing,
packaging and distribution of fluid food, primarily milk, soft drinks and other drinks
containing fruit pulp.

Tetra Pak supplies complete lines of processing, treatment and packaging equipment.
Various separators, homogenizes and heat exchangers constitute the key components of
the processing equipment. Tetra Pak sells six different packaging systems, to meet the
most diverse customer expectations. In addition, the product variety comprises
conveyor belts, tray fillers, shrink-wrapping machines, roller containers and other
equipment needed for product distribution.

In addition, Tetra Pak offers IT services, including product designing, plant control and
supervision systems, computer-aided logistic studies, training courses, repair &
maintenance of machinery and equipment and assistance to final product distribution.
Relying on experience gathered in the frame of highly focused R&D projects related to
fluid food, Tetra Pak can offer sophisticated expertise furthermore the company
assumes full warranty concerning the marketed machine lines. Such warranty is a key
precondition of ensuring safe activities of both the buyers and the suppliers.

Tetra Pak develops manufactures and market systems for the processing, packaging and
distribution of food and liquid food.

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Tetra Pak currently has 77 market companies around the world, 63 packaging material
plants (including licensees), and 14 packaging machine assembly factories. The
company has 20,900 employees and in 2002 reached net sales of EUR 7, 5 billion.
Tetra Pak products are sold in over 165 markets.

4. Tetra Pak
– Our
Motto

This is a one that

works not only with
our customers, but also
throughout the value chain,” says CEO Nick Schreiber. “It provides a global
positioning of Tetra Pak, and it will be the only motto for our company.

”Protects, means to keep safe, defend, guard, nurture, and care of it. It is an
active word that is an extension of our vision”

Good, means having the right qualities, being kind, benevolent and wholesome – it is a
positive word that we hope our customers will value. We also hope that it will offer
reassurance and choice to consumers.

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5. Tetra Pak – Rules of their journey

 Freedom with accountability

 Partnership with customers, suppliers and colleagues
 Long term perspective
 Innovation and creativity
 Commitment and Fun

6. Future Outlook

Tetra Pak launched new types of packaging after regular period of time. These are in
great demand as there are no competitors of them and it is believed that their sales will
grow more than that in future years. The company has added to its production new
techniques regarding hygiene and customer’s satisfaction. As the economic
environment stabilizes the company hopes to play role in attaining a much higher level
of prosperity in the future that they will not affected by any competitor in the future.
They are in the maturity stage i.e. they are at that time completely rule the packaging
industry

7. ISO – 9001 Certification

Tetra Pak’s, a name synonymous with quality, taste and trust for over 21 years, gained,
in 1982, another distinction: ISO 9001 certification and at no better time than the
successful completion of 21 years.

It is a matter of immense pride and honor for the Company that Tetra Pak has become
the first packaging company in Pakistan to achieve this prestigious distinction. It has a
complete monopoly in Pakistan i.e. it has no other competitor. What makes it more
significant is the fact that ISO 9001 involves all steps in the manufacturing chain;
starting from designing and development of products to production, right up to
distribution. Thus the Company, guided by its professional management, makes every
effort to ensure that the product packaging reaches to promise the customer’s
expectations. Another certification that increases Tetra Pak’s image in the market is
ISO 14001.

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8. Tetra Pak – Benefits

Tetra Pak Packaging has a very important function, which is to protect food and drinks
safely and efficiently from where they made to where they will be consumed.

It has following benefits:

 Protection Packages protect the contents from light, microorganisms and

air, and the environment from the contents of the package.

 Preservation Good packages can help preserve food and prolong its
shelf life during storage, transport retailing and consumption.

 Communication Packages carry important product information about

ingredients, quantities, nutritional value, use, sell-by dates and much more.

 Convenience Packages provide convenience for the consumer, enabling

the food to be handled, served and then stored what is left for future use without
getting it all over our hands.

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 9. S
i
t
u
a
t
i
on Analysis

General Environment

 General state of the economy

The outgoing fiscal year 2002-2003 has been the most difficult and challenging
year for Pakistan’s economy. The year witnessed the full impact of the
economic sanctions on domestic economy as well as the continuation of
deepening global economic recession with consequential impact on Pakistan’s
external sector. These two factors not only precipitated a balance of payments
crisis but also damaged the gains achieved in the preceding year, and most
importantly, interrupted the pace of implementation of structural reforms and
stabilization measures.

The imposition of economic sanctions and the suspension of new bilateral and
multilateral disbursement. Yet another notable positive development has been
the decline in inflation to 6.1 percent during the July-August 2002-2003 as
against 8.9 percent of the comparable period of last year.

 Economic situation of the industry

According to the census of manufacturing industries there were 77 market

companies around the world engaged in the packaging of various companies. In
Pakistan, it is the only and the largest packaging company. There are no
competitors of Tetra Pak in Pakistan, so till 2003 it enjoys 100 percent share in

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 the market. The sales volume increases from 570 million in 1998 to 1.1 billion
in the recent year.
The growth rate in the packaging industry has been estimated at 27% . The
most rapidly growing items are milk products, food products, chocolates and
others.
There is a significant scope for investment expansion in the packaging sector as
it has the monopoly in Pakistan. Domestic demand is buoyant and export
prospects are bright-although they are yet to be adequately explored. Several
major companies including well-known multinationals have substantial
investment commitments and there are also a large number of middle-sized
upward domestic firms. There is also a need for technology and know-how in
the areas of packaging, preservation and hygiene of the product. Several
Pakistani firms have developed ambitious modernization programmes.

 Situation of company in the industry

Tetra Pak is the first food industry in Pakistan to achieve distinction under ISO
9001, which gives it a unique standing. Tetra Pak has once again set the
monopoly now in 2003 also; there is no standing competitor against it, making
the industry more competitive and credible in international markets. Today,
Tetra Pak lives up by to its well earned reputation as market leader by insuring
that earned reputation as market leader by insuring that consumers get the best,
stylish and hygienic packaging. The best of technology, excellent packaging and
human resource for unparallel quality.

Product Market

Sales volume

Total sales volume of Tetra Pak is:

• In 1998-1999 was Rs. 5,70 million

• In 1999-2000 was Rs. 7,06 million
• In 2000-2001 was Rs. 7,68 million
• In 2001-2002 was Rs. 8,60 million
• In 2002-2003 was Rs. 1.1 billion

Growth rate

The growth rate of was 27% in Sales with an increase of 240 million.

Market share

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 Their market share is 100 % as there is no any other competitor against them.
They have the monopoly all over Pakistan.

Customer Market

 Demographic factors

People of all ages and gender use our packaged products because of their
advantages i.e. hygienic packaging and preservation. Educated and people
belonging to all classes use their packaged products. Their packaged products
are available in mostly all cities of the country.

 Life style pattern

The health and quality conscious people used our packaged products that care
about the health and cleanliness of the product they used. That is why packaging
matters so much in making the product successful.

 Usage pattern and behavior

Due to its hygienic packaging and preservation techniques, it is the most

powerful packaging company in the Pakistan. That is why they haven’t faced
any competitor against them. They have the total of 100 % market share.

 Preference for specific benefit

For over 21 years, Tetra Pak has maintained a tradition of producing one of the
finest packaging in the whole world and in Pakistan. That is why it continues to
be a familiar and trusted name in Pakistan. Today, Tetra Pak lives up to its well-
earned reputation as a market leader is insuring that consumers get the best
packaging. The best of technology and human resource have together
contributed to Tetra Pak’s reputation for unparallel quality – a standard now
recognized in overall Pakistan. Above all, the entire process is overseen by a
professional management and trained workforce.

Marketing Programs

 Advertising and promotional programs

• Television

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 Tetra Pak don’t advertise their packaging regularly. They also don’t advertise
heavily. Their advertisement is mostly through their customer like Nestle etc.
But they also sometimes advertise their packaging both during and off prime
time. Their decision to advertise or not depends upon the popularity of the
programme and the number of advertisers sponsoring it i.e. if too many
advertisers are sponsoring a programme then Tetra Pak usually don’t advertise
in that programme. But if their ad gets the benefit of being the first in the
commercial break then they usually avail this opportunity.
Tetra Pak usually advertise through some well-known personalities like
Abrar-ul-Haq (singer), Resham (actress) and Jehangir Khan (sports person),
Kamil Khan (architect), Ishaq Mushtaq (athelete).

• Newspapers and Magazines

Tetra Pak also use newspapers as their source of advertisement and

promotion. They mostly advertise twice in a month in “DAWN” on Sundays.
Their activities also are presented in this newspaper like when Tetra Pak
launched first generic UHT milk campaign Doodh, Aur Kya! It is also given
in the newspaper. Articles on various aspects of the UHT milk campaign kept
appearing in the newspapers and magazines before, during and after the airing
of the TV commercials.

 Relationship with Dealers, Wholesalers and Retailers

Burgeoning countrywide sales, with those in major cities, Karachi, Lahore,

Rawalpindi and Islamabad, are managed fully computerized and inter-linked
regional sales office. Their all customers’ products are widely used in all parts of
the country. Almost all the offices are on the internet/e-mail network ensuring
uninterrupted flow of data. Tetra Pak keep a good and sound relationship with
wholesalers, distributors and retailers to insure their sales volume grows because
these distribution channels can affect the sales up to large extent.

10. Consumer Research

Tetra Pak usually conducts consumer research before launching a new packaging way
through questionnaires and focus groups to check the demand of the product’s
packaging and also the customer’s response towards their packaging. And if the result
is positive then they launch that packaging method.

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 Consumer research is also done to check the current demand of the already existing
packaging method. They also hired up companies to do consumer research for them
like Aftab Associates.

11. Innovation and Flexibility

At Tetra Pak, Innovation is the result of the total process of developing an idea into a
product or a new way of working which adds value to the business.

There is much more to innovation than merely developing new products. Innovation
embraces everything from hatching an idea to reaching the marketplace with a new or
improved product. Whichever way you define it, it is important. Innovation is one of
the mainstays of our survival and growth.

12. Organizational Culture

“System of shared meanings and beliefs held by organizational members

that determines, in large degree, how they act”

There are main two types of culture:

• Strong Cultures

“Strong cultures are those cultures in which the key values are deeply
held and widely shared. These types of cultures have a greater
influence on employees than do weak cultures”

• Weak Cultures

“In weak cultures, the values and beliefs are not deeply held and shared
and they don’t have a much influence on their employees. The
organizational performance is not high in the organization with weak
culture”

• Tetra Pak’s Culture

Tetra Pak’s culture is very Strong because all the values are deeply held and
shared in the organization. That is the reason that they have Monopoly in
Pakistan. There are no other competitors of Tetra Pak in Pakistan. Also
worldwide they perform certain activities like consumer research, seminars and
advertisements that show their commitment to their work. Also to get the clear

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 idea that about Tetra Pak’s strong culture, let’s see the dimensions of the
organization culture.

• Dimensions of Tetra Pak’s Culture

 Attention to detail

It’s a degree to which the employees is expected to exhibit precision,

analysis and attention to details”

Tetra Pak has a very High in this dimension.

Tetra Pak is one of the biggest organizations of Pakistan. After so many years of
its existence in Pakistan, it remains in monopoly. The reason is that when they
make certain decisions, then lots and lots of factors involved in it and they
check all the factors with utmost precision. For example, if they want to
introduce a new product in the market. Then the whole process requires
accuracy. So, to make accurate product that is according to the customer
requirements, they first did Consumer Research and after accurately research for
what the customer needs, then they launch the new product with changes that
the customer want.

 Outcome Orientation

“In this organizer usually the management people focus on the results
they are getting. They concentrate on outcomes rather then how
they are being achieve”

Outcome Orientation is High in Tetra Pak’s culture.

It is the organization’s main responsibility that what kind of outcome they

produce. Tetra Pak is outcome orientated because it always focuses on the
outcomes and the way they achieve this outcome. Like again the example of
Consumer Research, it took a lot of effort to do this research because every
customer has its own perception about packaging. So, to dig out their habits is
not an easy task. It is also very time consuming. But above all, Tetra Pak just
sees the outcomes that are mostly very satisfying.

 People Orientation

“It is a degree to which management decisions take into the account

the effect on people in the organization”

Tetra Pak’s culture has a very High people orientation.

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 Tetra Pak is always concerned about their employees and other staff because
they thought that the employees in the organization are very much
responsible for an organization’s success and failure. So Tetra Pak is always
very much concerned about people in the organization. People are taken part
into the overall organization’s decision and their views and suggestion are
equally acceptable. They also have given lots of incentives on their better
work.

 Team Orientation

“It is a degree to which work is organized around teams rather than

individuals”

Team orientation is also very High in Tetra Pak.

Team orientation is now-a-days permanent part of any organization. So, Tetra

Pak is also in favor of team orientation. All the packaging design,
development, analysis and many more is done in teams and groups. The
projects that need lots of efforts, in these groups are also contain co. of people.
So, this means it depends on the projects pf the organization

 Aggressiveness

“It is a degree to which employees are aggressive and competitive

rather than cooperative”

Aggressiveness is Low in Tetra Pak.

Aggressiveness is below average in Tetra Pak because they always concerned

about working in a friendly and cooperative but challenging environment.
Yes, there is some kind of work-related aggressiveness is present that they
need to accomplish their tasks. But as Tetra Pak is in monopoly in Pakistan,
that is why there present low aggressiveness that is needed just to overcome
the threats for any new competitors in the future years.

 Stability

“It is a degree to which organizational decisions and actions

emphasize maintaining the status quo”

Tetra Pak’s culture is very Low in stability.

Tetra Pak from last five years constantly engaging to create something new
that is why they are not at all stable. It always focuses on the customer’s

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 requirements that are why they constantly change their packaging according to
what customer wants.

 Innovation and Risk Taking

“It is a degree to which employees are encouraged to be innovative

and take risks”

Innovation and risk taking is very High.

As Tetra Pak is low in stability just because that they always create
something new, something different and something unique for their
customers. Like their packaging designs, seminars, and shows and always
started a new campaigns like “Doodh – Aur Kiya” and many more. So, this
represents that Tetra Pak is very innovative.

• How People learn Culture of Tetra Pak

Culture is transmitted to employees in a number of ways like:

 Stories

“Organizational “stories” typically contains a narrative of significant

events”

So, in Tetra Pak, stories are also widely used because they believe that it told
about the organizations past help shape the future. The storytellers in Tetra Pak
can be middle managers as well as first line managers and the non-managerial
employees. They told the new people about the company’s heritage and general
rules and regulations so that people learn from them.

 Rituals

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“Rituals are repetitive sequences of activities that express and reinforce
the values of the organization”

Tetra Pak is very much into following these rituals in order to learn their
employees about organization’s culture. Because for Tetra Pak, their goals are
very important as well their employees are very important too. So, to maintain
this, they arrange different seminars, functions, concerts for their employees as
well as to launch any new product or just introduce any new feature of they’re
product to the whole marketing world. Also, they arrange an Annual Day for
their employees and customers, in which they discuss the whole last year and
planned for the next year. They perform following rituals:

• Press Conference

They also used to organize press conference on launch of their new

campaigns. Like, the campaign kicked off with a press conference, which
unveiled the UHT milk campaign Doodh, Aur Kya! Follow-up articles and
press releases became a regular feature of the campaign and played a vital
role in its overall success.

• Follow-up Campaigns

They also used follow-up campaigns during their UHT milk campaign every
now and then. Tetra Pak Pakistan got several opportunities to keep the
message of Doodh, Aur Kya! First in the series of these campaigns is the
Basant campaign and then Mother’s Day campaign.

• Customers Campaigns

The campaign line, Doodh, Aur Kya! Was further extended to customers
advertising? Thus, Tetra Pak’s customers for promoting their own UHT
milk brands equally shared the goodwill generated by the UHT milk
campaign and Tetra Pak Cricket Quiz promotion, Jawab Hai - Doodh.

• Outdoor Support Campaigns

Tetra Pak also uses buses to promote their new packaging techniques and in
the launching of the new packaging.

• Boarding

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 They also use billboards and boarding as their part of promotional activity.
Like they placed the board outside Packages center, in which they
congratulate themselves for achieving 1.1 billion targets in sales volume.

• Arranging Seminars and Functions

Tetra Pak also regularly arranges functions to promote their activities. Tetra
Pak organized its 3rd Customer Day on April 16, 2001, during which, Tetra
Pak’s customers and their spouses spent a cheerful evening. They also
organized Customer Day in 2002 as well. They also arrange recreational
activities like Concerts in which they invite famous singers. They also
arrange seminars on World Environment in 2002.

 Material Symbols

In Tetra Pak, material symbol are also used. Employees can learn culture by
seeing the layout of the Tetra Pak building, the dress of employees and
executives, types of car top executives is provided and many more.

 Language

Language refers to unique and special terms, used in the culture of the Tetra
Pak. In Tetra Pak, many people used specific language, which shows
organization culture when the employees learn this specific language, and then
it’s easy for them to understand the culture of an organization. This is not a
language, which is created specially by an organizational management, but the
employees themselves create it. There is no hard and fast rule to learn that
language.

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 13. Environment

For Tetra Pak, being a successful company also means commitment to the
environment. Tetra Pak has developed goals, activities, and organizational and
evaluation structures necessary to turn this mission into action. Tetra Pak's overall
environmental impacts depend on actions taken at every stage of the life cycle of our
products and services, from design and purchasing, through to transportation, filling,
consumption and disposal.

In our environmental activities we therefore focus on managing environmental

impacts in every phase of the life cycle. Tetra Pak's employees, suppliers, customers
and the communities are all important partners in achieving this.

14. Tetra Pak’s Environmental Policy

Our policy translates the mission statement into key principles that we expect the
whole company to follow. It further provides the basis for our environmental plans,
goals, programmers and activities. The policy was issued 1997 by our CEO.

The policy aims at achieving environmental excellence in the three major areas of our
activities:

Product design and manufacturing

Management Processes

Communication

15. Env
iron
men
tal

Organization

22
 Tetra Pak has a professional and well-structured environmental organization in place
to ensure that plans become reality in our operations worldwide.

The Environmental Council is Tetra Pak’s environmental policy-making body

consisting of management representatives from different regions, business area and
functions, directly reporting to Tetra Pak's Global Leadership Team. The
Environmental Council sets and monitors implementation of goals, and decides on
future directions. The Corporate Environmental Affairs Group makes sure that the
Council's decisions are implemented. Furthermore, in each of the regions, business
areas, factories and market companies, there are staff especially responsible for
environmental affairs.

In addition to having a dedicated environmental organization, we consider the

environment part of every employee's job. For environmental plans to be
implemented successfully, employees need to be committed to these plans and
empowered to act. We have launched an employee environmental awareness program
called 'Eco Drive' in September 2001 aimed at informing employees about Tetra Pak's
environmental activities and at increasing commitment to reaching Tetra Pak’s
environmental goals.

We held a first Tetra Pak worldwide Environment Day in 2001, which was successful
with more than 50 locations joining in the activities. A second Environment Day will
take place on 29 September. To further encourage employee involvement in
environmental affairs and generate ways to further improve environmental
performance, Tetra Pak is also holding an Environmental Ideas Competition among
all Tetra Pak employees.

16. Managing the Environment

For Tetra Pak, being a successful company also means being committed to the
environment. Tetra Pak has developed the goals, activities, and organizational and
evaluation structures necessary to turn this mission into action. Tetra Pak’s overall
environmental impact depend on what happens at every stage of the life cycle of our
products and services, from design and purchasing, through to the transport, filling,
consumption and disposal of our packages. This is why Tetra Pak’s environmental
programs and actions focus on managing and minimizing the environmental impact in
every phase of the products' life cycle. Tetra Pak’s employees, suppliers, customers
and the communities are all important partners in achieving this.

They also use the “Life Cycle Approach” to describe how Tetra Pak manages the
environmental impact of its own operations and in relationships with suppliers,
customers and the communities we serve.

Examples of managing environmental issues throughout the life cycle:

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 Design

Decisions we make during the design stage can have an environmental impact
in other stages of the life of a Tetra Pak package or product. An example is that
we have to think about using materials that can be recycled.

This is why we consider the environment as part of our design process. We aim
to ensure that the package fits into existing collection and recycling systems in
the markets where we do business. It is our goal to optimize the environmental
performance throughout the product's life cycle, without compromising our
customers' needs for safe, functional and cost-effective packages. Another fact
that we have to bear in mind during the design stage is that food production can
have a significant environmental impact. Packages help prevent food being
wasted and similarly, they prevent the wasting of resources used to produce
food.

 Supplier Management

Some environmental impact of the package comes from activities that Tetra Pak
does not control directly. An example is the extraction of raw materials needed
to produce our packages.

However, we strongly encourage our suppliers to improve the environmental

performance of the materials they supply to us. We think of our relationship
with our suppliers as a partnership. Together, we try and find ways to improve
environmental performance. A typical issue that comes up in discussions and
negotiations with our suppliers is how to ensure that fibers are sourced from
well-managed forests.

Four times a year, we evaluate our Main Global Suppliers on their overall
performance. How well they are doing in environmental matters constitutes 5-
7% of their overall score.

 Sustainable Forestry Management

The main raw material Tetra Pak uses “Paper Board” is made from wood. Wood
is a renewable resource.

Tetra Pak's ambition is that all the wood fiber used to make our packages comes
from, and can be shown to come from, forests managed in line with the
principles of sustainable forest management. Our global suppliers of paperboard
have done a lot of work in recent years to achieve and demonstrate sustainable
forest management practices in forests that they manage themselves. Now we
are asking them to help us ensure that all the wood fiber that ends up in our
packages comes from sustainable managed resources.

24
 Translating this ambition from theory into practice is a large task and we are
therefore using a step-by-step approach. We expect our suppliers to accept
achieving this ambition as a common priority. We measure progress as part of
our supplier assessment system.

17. Specific
Environment

“It includes those

constitutes that have a direct and
immediate effect on manager’s
decision and actions”

It includes:

 Customers

Tetra Pak exists to meet the need of their customers because it is the customers
or client who absorbs the organization’s output. Tetra Pak provide packaging to
the following customers:

• Nestle Milkpak Ltd

• CDL Foods Ltd.
• Frooto Industries (Pvt.) Ltd.
• Popular Foods Industries (Pvt.) Ltd
• Mahaar Food Industries Ltd
• Ravi Agricultural & Dairy Products Ltd
• Royal Dairy Products Ltd
• Standard Fruits Ltd.
• Tops Food & Beverages
• Vita Pakistan Ltd
• Juice Pack Industries Ltd
• Faraz Fruit Juices (Pvt.) Ltd

25
 • Husnain CPD. (Food & Beverages)
• BENZ
• General Dairy
• Pakistan Fruit Juices Co.
• Noon Pakistan Ltd
• Shezan International Ltd

 Suppliers

“Suppliers are those who provide material and equipment”

Tetra Pak is the renowned name in Pakistan. They provide packaging to the
customer that targeted towards the all classes. Because of their quality and
monopoly in Pakistan, they have 100% market share. They buy all their raw
material and packaging material from one supplier from the last 22 years.

 Pressure Groups

“Pressure groups are the special-interest groups that attempt to

influence the actions of the organization”

Tetra Pak has no concerned with pressure groups.

 Competitors

Tetra Pak enjoys complete monopoly in Pakistan since it is developed in this

country. As there is no competitor their for Tetra Pak, so they have 100%
market share and also greatest sales volume, but beside they also have the threat
of some new company that will be launched their packaging in the market. So,
they tried to develop new strategies after regular intervals.

26
 18. General Environment

“It is the broad external conditions that might affect overall organization’s
performance”

 Cultural and Social Environment

Every region in Pakistan has its own culture and every culture has its own
demands. Items that are of eating and drinking also attract people but with better
and safe packaging so that it also be feasible for health conscious people. Tetra
Pak’s customer product is widely used in all the classes of Pakistan but especially
in rich and educated people who are conscious of better and secure packaging.
Their number is very less than as compared to other countries like USA, UK and
other European countries, so that is the reason why overall sales is less.

 Economic and Technological Environments

As we are living in a developing country like Pakistan here per capita income is
very low so people cannot afford products of high prices as stylish packaging is
some sort of luxury so most of the people can not afford it and also due to
political and economical instability, the country is suffering in inflationary
condition. This can affect the sales of the products. The economic conditions of
Pakistan have worsened from past few years even then Tetra Pak’s sales are
increasing (from Rs. 5, 70 million in 1998 to 1.1 billion in 2003). This may be due
to the technological factor that the popularity of satellite channels is increasing
day by day in each and every part of Pakistan and as a result people are becoming
more about packaging and hygienic conditions. This is the reason that sales are
not affected in Pakistan due to people awareness.

 Political and Legal Environment

Federal, state, and local regulation. Limit choices available to organization.

In case of consumer’s protection legislation, it will have no negative effect as
Tetra Pak is environment friendly organization and cares about the health of its
customers. There are certain laws for packaging control and hygiene in Pakistan
and Tetra Pak follows them. Quality of Tetra Pak’s packaging is according to
standards set by the government. Representatives of the government conduct
surprise test to check the hygienic quality of the packaging. Political conditions of
Pakistan are very unstable and it has a bad effect on every sector of economy

27
 including packaging industry. Even then the sales of Tetra Pak are unaffected.

 Competitive Environment

As there is no competitor their for Tetra Pak, it enjoys monopoly in Pakistan since
it is developed in this country but besides that they also have the threat of some
new company that will be launched their packaging in the market. So, they tried
to develop new strategies after regular intervals.

 Political Conditions

Political conditions involve general stability of the country and attitudes of

government officials toward business. Tetra Pak is adopting the concept of all
consumerism since its establishment in Pakistan and Pakistan and that is the only
reason that it is standing on the top of the market. They know how to care and
capture the customers and how to retain them. Every government tries to provide
public the best Tetra Pak is getting benefits from this act, as it is more practice of
consumerism than its competitors.

 Demographic Environment

Trends in the physical characteristics of a population. Demographic conditions are

changing day by day in Pakistan. Through the change in the ideas, more women
are getting into the working field, which is a good sign of Tetra Pak because
females can make their own choices to decorate their places from millions of
shadows, which Tetra Pak is offering. With a change in demographic conditions
Tetra Pak now is facing new Challenges.

 Global Environment

It is one of the major factors now days, which is affecting organizations. This is a
truly global company. Its customers and consumers are all over the world and
they manufacture and sell in all parts of the world. That geographic reach not only
means they are delivering exactly what their customers and consumers want, the
way they want it, where they want it, it also means that it affords the Group a
level of protection against the vagaries of economic fluctuation around the world.
So global conditions affect the organization, new technologies and entrants of
new companies are always threats for Tetra Pak.

 Ecological Environment

28
 The packaging of the products is harmless to the environment, as they are UHT
treated and pasteurized. Tetra Pak cartons are fully recyclable. They can be made
into high-quality paper products such as paper towels, tissues, stationary and other
useful products like plastic and lumber, rulers and pens. They recently use
campaign that is named as Proud Pakistanis Recycle Tetra Pak (Friends of the
environment). The objective of this campaign is to provide a clean and healthy
living environment to the people of Pakistan.

19. Level of Social Responsibility

Two opposing views of social responsibility are:

 Classical View

Tetra Pak has also its classical view that is to maximize profits. Because what
they do and perform, ultimate goal of an organization and manager is to operate
the business in the best interest of the stockholders.

 Socioeconomic View

But in Tetra Pak, managers are also socially responsible not only in making
profits but also protecting and improving society’s welfare like:

They provide packaging of the products that is harmless to the environment, as

they are UHT treated and pasteurized. Tetra Pak cartons are fully recyclable.
They can be made into high-quality paper products such as paper towels,
tissues, stationary and other useful products like plastic and lumber, rulers and
pens. They recently use campaign that is named as Proud Pakistanis Recycle
Tetra Pak (Friends of the environment). The objective of this campaign is to
provide a clean and healthy living environment to the people of Pakistan and
also to fulfill their social responsibility.

The Environmental services Tetra Pak can offer to their customers are:

• General recovery/recycling expertise

• Support on waste reduction efforts and production planning. This planning

is very important to reduce product loss.

• Identifying equipment that customers can use to empty beverage cartons

• Tracking of and advice on compliance with current or future legislative

requirements

• Support on implementation of environmental management systems

29
 • Providing general and product-specific environmental information for
communication purposes

• Helping customers to improve performance and efficiency at their sites

using Tetra Plant Opt(TM).

Also they perform recycling as well:

• Recycling

Recycling is a high priority requirement put on Tetra Pak by customers,

consumers and society in general. We therefore find it important to make a
commitment to recycling and do what we can to facilitate recycling of our
packages.

Several of the activities we undertake to promote and facilitate recycling

include:

- Actively supporting the development of new technologies for recycling

has used packages and the recovery of the different materials contained in
them.

- Working closely with governments, local authorities, suppliers, recycling

companies and local entrepreneurs to find stable and low cost recycling
solutions and capacity with minimal environmental impacts.

- Finding ways to make recycling more cost-efficient, for example by

promoting new sorting equipment. Collection and sorting costs can form a
considerable part of the overall recycling costs.

30
• Food for development

For more than 40 years, Tetra Pak has been involved in providing milk to
schoolchildren around the globe. Every year, more than 1000 million liters
of milk is delivered to children in schools, in Tetra Pak packages. More
recently, the company has taken new initiatives to help develop school
feeding programme based on soybeans, rice, peas and other food-based
beverages. Tetra Pak has also begun to work in partnerships that create
integrated agricultural, food processing, packaging and distribution
initiatives; complete food delivery systems - from "cow to consumer".

Tetra Pak’s Food for Development Office (FfDO) is the mechanism the
Company uses today, to co-ordinate the extensive knowledge base
gathered over so many years in school feeding and agricultural
development and to make that experience available as part of the Group’s
overall good corporate citizenship efforts.

31
 The FfDO works to co-ordinate and support school feeding and
agricultural development programmes in partnership with development
agencies, funding organizations and NGOs (Non-Government
Organizations) and of course our customers.

• An urgent need

In the year 2000, more than 80 countries had lower GDPs than they had in
1990. Few people would dispute that the elimination of world poverty is a
challenge that needs to be resolved on a global level.

To this effect, the UN member countries have signed a pledge, “The

Millennium Development Goals”, to halve world poverty by the year
2015. To realize this, education, sustainable farming, food security and
nutrition are key success factors.

With activities in more than 165 countries Tetra Pak recognizes its ability
and responsibility to help. Dr Ruben Rausing, the founder of Tetra Pak,
stated that: “A package should save more than it costs.” His principle
echoes today in Tetra Pak’s commitment to making food safe and
available everywhere.

For children growing up in impoverished areas, food consumed in school

is imperative to retaining their health and motivation. Conservative
estimates show that there are 300 million chronically hungry children in
the world, of which 170 million are not fed at school.

Tetra Pak believes that the best way to help promote sustainable economic
and social development is by founding strong partnerships between the
public and the private sector. Strong ties between local government,
private industry, NGOs, international and national development agencies
are crucial to achieve substantial breakthroughs in education, sustainable
farming, food security and nutrition. Experience shows that a school-
feeding programme
can be the catalyst
that creates the
growth of local food
production and
processing

32
 • New feeding programme initiatives

In 1997 Tetra Pak started its own school milk programme in Indonesia
covering 10,000 children. Through co-operation with the US Trade Office,
a model for financing based on food aid donations was developed. The US
Government, through the United States Department of Agriculture
(USDA), have for many years donated surplus commodities to developing
countries, often through the UN’s World Food Programme (WFP). Some
of these donations are used for School Feeding Programmes.

At the G8 meeting in Japan 2000, which brought together the leaders of

the eight leading economic powers, the USA launched the Global Food for
Education Initiative. This and other US initiatives have so far resulted in a
number of school feeding programmes based on Tetra Pak technologies
and knowledge (Vietnam - 300,000 children, Bangladesh - 200,000
children, Indonesia - 800,000 children, and new programmes will begin in
the Philippines, Pakistan and Uzbekistan during 2003). All these
programmes are managed by the International Development Office of the
US Co-operative Land O’Lakes - (LOL), with whom Tetra Pak has
established a close co-operation.

With the world’s focus on the difficult HIV/AIDS situation in many

African countries today - and the need to develop highly nutritious feeding
products to improve the living conditions for HIV/AIDS infected persons -
Tetra Pak is also intensifying its activities in this area.

20. The “Greening” of Management

Production of our packaging material is a key area of focus for Tetra Pak, and the
one which we have the greatest chance of influencing.

Examples of the kinds of environmental impact associated with our manufacturing

sites are:

• Raw material consumption (paperboard, plastics, aluminum foil)

• Handling of waste

33
 Energy consumption (our carton converting plants account for 94% of our total
global energy consumption). We work towards reducing environmental impact as
far as possible by using modern and environmentally sound production techniques.
To ensure continuous environmental improvements, all our factories are
implementing Environmental Management Systems (EMS) and certifying these to
the international standard ISO 14001 or EMAS. More than 73% of Tetra Pak’s
manufacturing sites now have environmental management systems in place. The
goal is to reach 100% by 2004.

In addition, we are monitoring performance in a number of key areas using

environmental performance indicators (e.g., electricity use, fuel and fresh water
consumption, total material waste, waste to landfill). Furthermore, our individual
plants are encouraged to set their own reduction targets.

21. Managerial Ethics

“Ethics are rules and principles that define right and wrong conduct”

Ethics for managers are important because mangers are whom who control the whole
organization; they are the role models for all the employees working in that particular
organization, so they are supposed to follow the ethics. These are the following views
of Ethics.

 Utilitarian view of Ethics

“The view of ethic that says that ethical decisions are made only on the
basis of their outcomes or consequences”

It is the view, which shows or tells us that decisions should be made in a way to
get good and favorable results .For that purpose decisions are made after taking
and analyzing quantitative measures. According to that ethical view managers
should take decisions to get the best outcome, like manager thinks that leaving of
30% work force is in the favor of an organization and stake holder and that
decisions increase the output than he should take that decision. Tetra Pak
managers are well trained and they are well motivated to take good and favorable
decision for an organization, which increase the output of an organization.

 Right view of Ethics

“A view of ethics that is concerned with respecting and protecting

individual liberties and privileges such as freedom of conscience, free
speech, life and safety and due process”

34
 Tetra Pak take care of this code of ethics .Its provides employees freedom of
speech, safety and self-respect. Tetra Pak managers are trained to respect others,
and give others opportunity to speak what ever they want to speak. They gave all
the incentives to their employees as well.

 Theory of Justice view of Ethics

“A view of ethic in which manager imposes or enforces rules fairly or

impartially and do so by following all legal rules and regulation”

Sometimes managers have to take decisions, which are just imposes on

employees, like assigning duties, and fixing wage rate. Manager ethical duty is
that he gives same pay to the employees those who are performing the same type
of duties. In Tetra Pak duties and wages are fixed at the first day of the job, Tetra
Pak mangers try to behave equally with all the employees. Tetra Pak management
also try to eliminate the favoritism from its environment.

• Core Values

In the absence of detailed rules and regulations, our corporate culture helps
guide our decisions. The fundamental core values within Tetra Pak relate to our
corporate culture, serve to keep our team together and give us a true competitive
advantage.

• Freedom with Accountability

Freedom with Accountability characterizes our working lives. We believe each

Tetra Pak employee should have the power to take initiatives to develop and
improve our business, sharing knowledge with our colleagues - and we act as if
the company was our own. But with the freedom, we accept the responsibility to
act always in the best interests of Tetra Pak.

• Partnership with Customers, Suppliers and Colleagues

Partnership with Customers, Suppliers and Colleagues is our second core value.
We want our customers to see us as proactive business partners, using our
global expertise in food processing and packaging to meet their needs, add value
and deliver competitive advantage. We want our suppliers to speak of our high
regard for quality in everything we do. With our colleagues, we focus on
positive outcomes and on creating a good working climate, sharing knowledge
and common goals. We remember that partnership at all levels also means
listening, recognizing and learning from the achievements of others.

• Long-Term Perspective

35
 We take a Long-term Perspective at Tetra Pak, recognizing that our vision is
best served by working towards long-term goals. We don't forget the need for
short-term results, but we avoid 'quick fixes', which only bring temporary
benefits. Instead, we focus on learning and experimentation. This also means we
seek to develop mutually beneficial long-term commitments to customers and
suppliers.

• Innovation and Creativity

Innovation and Creativity at Tetra Pak means we deliberately set ourselves

challenging goals, to encourage us to constantly strive for new and better
solutions. We keenly follow market trends and technical developments and
strive to gain the competitive edge. We are proud to share and build on the ideas
and the knowledge of our partners. We work to make sure that everything we
produce, product or service is fully fit for its purpose - and we continue to
innovate to ensure they remain so. We take pride in our willingness to change
and know that past performance is no guarantee of tomorrow's success.

• Commitment and Fun

We promote both Commitment and Fun at Tetra Pak. At work, we enjoy the
benefits of membership in a committed team that puts the company's interests
ahead of our own. We know that having fun on the job promotes creativity and
improves results and we work hard to maintain this working atmosphere. We
take pleasure from achieving our objectives and seeing things through to the
end. We are self-motivated and take responsibility for ourselves, our attitudes
and the working climate around us.
In the absence of detailed rules and regulations, our corporate culture helps
guide our decisions. The fundamental core values within Tetra Pak relate to our
corporate culture, serve to keep our team together and give us a true competitive
advantage.

22. Packaging
Tetra Pak is no longer only synonymous with liquid-food cartons. They now supply
hundreds of different types of ambient, chilled and plastic packaging, from cartons to
EBM and PET bottles with multiple packaging options. They also deliver around 89
billion units of different types of packaging to more than 165 countries and have
experience in packaging almost every type of product, in almost every climate and in
almost all conditions.

23. Product examples

Tetra Brick: Aseptic packages have a rectangular brick shape and are specifically
36
 designed to be stacked on the European pallet. It exists in four different formats:
Baseline, Midline, Squirreling and Slimily. The basic Tetra Brick Aseptic technology is
the same one used to produce Tetra Classic Aseptic, Tetra Prism Aseptic, Tetra Wedge
Aseptic and Tetra Finn Aseptic packages.

Tetra Recant is a carton-based processing and packaging system for retorted food
developed by Tetra Pak. Using retorting technology or in-container sterilisation, they are
now able to provide an alternative packaging solution for a variety of food products that
have traditionally been packed in cans or glass jars such as fruits, vegetables, ready meals
and pet food.

The Tetra Prisma Aseptic package is a unique carton package with its octagonal
shape and eight facing panels. It is suitable for iced tea, iced coffee, wine, milk, still
drinks and juice beverages. The volume range is 200 ml, 250 ml, 330 ml, 1,000 ml and
2,000 ml.

The Tetra Top package consists of a unique combination of fibre-based body and
integrated plastic lid.

24. Planning Process

Planning is often called the primary management function because it establishes the
basis for all other functions that managers perform. Without planning, managers of
Tetra Pak wouldn’t know what to organize lead and control. In fact, without plans,
there wouldn’t be anything to organize, lead; or control. So, in Tetra Pak, managerial
planning involves two elements:

 Goals

“Goals are the desired outcome for individuals, groups, or entire

organization”

Tetra Pak also has several goals. At first glance, it might appear that organizations
have a single objective to make a profit, but in reality, all organizations have
multiple objectives.

There are different types of goals. The one that used in Tetra Pak are:

Stated Goals

Official Statement of what an organization says, and what it wants it’s

various stakeholders to believe, its goals are”

Tetra Pak also made an official statement of what is to be done in next few
weeks. Usually this statement is for short-term goals that they have to

37
 accomplish with in a year. The copy of this statement is with every employee
who took part in this activity.

 Plans

“Plans are documents that outline how goals are going to be met including
resource allocation, schedules, and other necessary actions to accomplish
the goals”

There are many types of plans, but the one that used in Tetra Pak are follows.

• Strategic Plans

“Plans that apply to the entire organization, establish the organization’s

overall goals, and seek to position the organization in terms of its
environment”

Tetra Pak use strategic plans to make their overall goals and objectives. It is
very necessary to have such plans so to achieve their targeted goals.

• Operational Plans

“Plans that specify the details of how the overall goals are to be
achieved”

Now, with strategic plans, they also need a plan that tells them that how to
achieve their goals. It is with the help of operational goals.

• Directional Plans

“Plans that are flexible and that set out general guidelines”
As Tetra Pak is very innovative and has dynamic environment, so their plans are
always changing according to various factors like market trends, environmental
factors and many more. So, they use flexible plans like directional plans.

Apart from all these plans, the plans made in Tetra Pak often divided into two
terms. Some plans are with a time frame of less that one year (Short-term) and
some are with more than one year (Long-term). Also, some plans made in Tetra
Pak are specifically to meet the need of a unique situation (Single-use plan) and
some plans provide guidance for activities repeatedly (Standing Plans).

38
 25. Appro
aches
to

establish goals

 Management by Objective (MBO)

Tetra Pak is very much people orientated organization. They always concerned
about their employees. So, they use MBO to establish goals. In this type of
system, all the members of the organization are establishing goals jointly. So, it
means they establish goals as well as motivate their employees by involving them
in organizations decision.

26. Business Strategy

“The set of managerial decisions and actions that determines the long-run
performance of an organization”

Different organizations have different strategies and managers are responsible to

accomplish these strategies. So, Tetra Pak use:

 Corporate level Strategy

“An organizational strategy that seeks to determine what businesses a

company should be in or wants to be in”

Tetra Pak use corporate-level strategy to make strategies. So, after using this
strategy, analysis of the whole organization took place.

39
SWOT Analysis with respect to 5 P’s

Product

Strengths
Their biggest strength is that they have the complete monopoly in Pakistan.
There is no other packaging company in Pakistan.

a. Their other strength is getting ISO 9001 and ISO 14001 accreditation,
making it the first and only packaging company in Pakistan to achieve the
honor.
b. Their biggest strength is their goodwill and old name because it is the only
packaging company in Pakistan.
c. It is the most trusted company in Pakistan. They offer packaging to
products of 18 companies in Pakistan.

Price

Strengths

Their price depends on their customer’s price. Their mostly

customers are targeting upper and upper middle class. So they did
packaging on their customer’s demand.

Weaknesses

Mostly customers of Tetra Pak targeted toward upper and upper

middle class and their prices are somewhat higher. So, this also
affects their sales.

Opportunities

They have the price according to their customer demands. They have
their customers from all classes i.e. from upper to lower. So they
have different price levels for all the classes.

Threats

40
 They have the threat that in future may be their new competitors
target all classes at lower prices.

Place

Strengths

a. They have their sales offices in the major cities of Pakistan. They first
introduced Tetra Pak in collaboration in packages in Pakistan, so their
main office is in Lahore. Also, they have their other offices in Islamabad
and Karachi etc.
b. Their packaging is well known and distributed in almost all the big
and small places in Pakistan.

Weaknesses

They don’t have any sales offices in small but rich industrial cities
like Faisalabad etc. This may have a negative effect on their sales in
future.

Opportunities

It is their opportunity that they have sales offices in major cities of

the country like Lahore, Islamabad and Karachi.

Threats

They have the threat that new competitors enter at any time in the
market. As Tetra Pak has no sales offices at small cities, so may are
new competitors will target those small cities. So this is the main
threat for them.

Promotion

Strengths

41
 a. Although their ads are not regularly presented in television, yet
they have the successful ad campaigns due to the presence of the
well-known personalities.
b. They have the good relationship with wholesalers, retailers and
dealers.
c. They also promote heavily by arranging seminars, functions, and
press conferences.
d. They also launched their new techniques by first introducing them
through.

Weaknesses

Tetra Pak’s advertising is not frequent enough to attract people.

Their ad though successful but should be changed now.

Opportunities

They have very good image in the market as they arrange seminars
and campaigns on launching of their new products.

Threats

They have the threat that may be their new competitors think of any
new and challenging campaign just to increase their popularity.

Positioning

Tetra Pak have positioned their packaging world wide as:

“Protects what’s good”

In Pakistan, the milk is more used than juices, so they are creating the
image of their product (packaging) by using the slogan

“Doodh, Aur Kiya!”

27. Planning Tools and Techniques

Now we look forward to see which techniques have been developed to help managers
in planning.

42
Environmental Scanning

“The screening of large amounts of information to anticipate and interpret

changes in the environment”

It involves two basic parts:

• Competitor Intelligence

“Activity to identify who competitors are, what they are doing and
how their actions will effect the organization”

As there is no competitor of Tetra Pak in Pakistan, so they have no need of

Competitor Intelligence and Reverse Engineering.

• Global Scanning

“Screening of information on global forces that might affect an

organization that has global interests”

It is important for Tetra Pak to globally scan its organization, as it is a very

huge industry. Also because world markets are complex and dynamic,
managers have expected the scope of their sacking effort to gain vital
information on global forces. Tetra Pak use information networks and
computerized systems to monitor global changes.

Forecasting

“Forecasting is the process of predicting organization’s outcome”

In Tetra Pak, both the methods of forecasting are used:

• Quantitative Forecasting

Tetra Pak applies a set of mathematical and statistical rules to a series of past
data to predict outcomes.

• Qualitative Forecasting

As Tetra Pak has very qualified managers and employees, so they used to
make their organization’s decisions on the basis of their experience,
intelligence and judgment.

43
 Benchmarking

“The search for the best practices among competitors or non competitors
that led to their superior performance”

In Tetra Pak, benchmarking is not used, as there is no competitor. Yes, to

overcome the threat of competitors in the futures, they change according to the
new market and current demand and also according to their customer
requirements.

28. Technique for allocating resources

“Resources are the assets of the organization and include financial, physical,
human and intangible resources”

There are number of techniques to allocate resources. In Tetra Pak, following technique
is used.

Budgeting

“It is the process of building a numerical plan for allocating resources to

specific activities”

Tetra Pak used this method to allocate resources to specific activities performed in
the organization. Managers typically prepare budgets for revenues, expenses, and
large capital expenditures such as equipment.

Tetra Pak’s Budgeted Sales-2004

44
2004 Total net sales (bio Euro) 7.3
Packages delivered (million) 104,975
Liters of products delivered in Tetra Pak packages (million) 58,820
Employees 21 100
Machine assembly plants 15
Packaging and packaging material plants 65
Number of markets 165
Market companies 58
Sales offices 47
R&D centers 20
Service centers 59
Packaging machines in operation 8,702
Packaging machine deliveries 768
Processing units in operation 20,730
Processing units deliveries 2,630
Distribution equipment in operation 12,332
Distribution equipment deliveries 1,501

45
29. Organizational Structure

“Organizing is the process of creating an organization’s structure”

46
 1.
W

ork Specialization

“The degree to which tasks in an organization are divided into

separate jobs”

47
 Tetra Pak has very High work specialization. The departments being made
according to the different work activities. For example, there are different
departments of Management, Marketing, Finance, Human Resource and many
more. So, in this way work is being specialized in Tetra Pak.

Departmentalization

“The basis by which jobs are grouped together”

In departmentalization, Tetra Pak uses Functional Departmentalization. In

Tetra Pak, jobs are being divided according to the function they perform. For
example, all the finance people come under finance department.

Chain of Command

“The continuous line of authority that extends from upper organizational

levels to the lowest levels and clarifies who reports to whom”

There are three things in chain of command for Tetra Pak. Tetra Pak uses
Authority that gives to the top management to tell all the people what to do
and expect them to do it. Then there comes, Responsibility, now after getting
decisions from the top managers, it is the duty of all the employees to perform
their assigned tasks. Then last but not the least, comes, Unity of command, it
is also present in Tetra Pak, each person or first line manager reports to
middle manager and middle manager and middle manager then reports to top
level manager.

Decentralization

“The degrees to which lower-level employees provide input or actually

make decisions”

In Tetra Pak, there is a concept of decentralization. Every person from upper

to lower level is involved in making organization’s decision.

Formalization

“The degree to which jobs within the organization are standardized and the
extent to which employee behavior is guided by rules and procedures”

48
 In Tetra Pak, formalization is Low. Employees have a great deal of freedom to
work in what the ways they like and job behaviors are relatively unstructured.

30. Organizational Design

Organic Organization

“An organization design that’s highly adaptive and flexible”

Tetra Pak uses this organic structure because of its extremely dynamic
environment. There is a high work specialization, low formalization, and they
change rapidly as need requires. Employees are highly trained to handle all kind
of jobs that are assigned to them. There is high decentralization and cross-
functional team to perform certain duties of the organization.

31. Employee’s Motivation

“Motivation is the willingness to exert high levels of effort to reach

organizational goals, conditioned by the effort’s ability to satisfy some
individual need”

Tetra Pak use two theories to motivate its employees.

 Herzberg’s Motivation-Hygiene Theory

“The motivation theory that intrinsic factors are related to job

satisfaction and motivation, whereas extrinsic factors are associated
with job dissatisfaction”

Tetra Pak uses this theory because they believe that an employee’s relation to
his or her work is a basic one and that his or her attitude toward work
determines success or failure. So, it is very important to know that what people
want from their jobs. Tetra Pak is very much concerned by this factor, it always
gave incentives to its employees as well as observed that whether this employee
is suitable for this job or not and if he or she is suitable and working better then
sees that is he or she is happy to be on this post or not.

 Three-Needs Theory

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 “This is the motivation theory that says three needs – achievement,
power, and affiliation – are major motives in work”

Tetra Pak uses this theory to motivate its employees. First is need of achievement,
this is necessary for personal achievement of employees because then they think
of their accomplishments and not on the rewards. Then comes, need for power,
they need to make others behaved a way that they wouldn’t have behaved
otherwise. And the last is need for affiliation, means the desire for friendly and
close interpersonal relationships.

Tetra Pak also arranges different events and rewards to motivate its employees
like:

• Trips
• Concerts
• Annual Employees Day
• Employee of the month
• Bonus
• Parties

Tetra Pak is present in 165 markets every day, normally on call around the clock.
That wouldn't be possible, of course, if it weren't for committed employees.

Working is a big part of life. Sometimes you probably spend more time at work
and with your colleagues, than with family and friends. Therefore it's so very
important that you feel not only satisfied but also challenged by your daily tasks -
and that your work allows for personal space and leisure activities in between.
Only then you can perform well in the long run.

That kind of working environment is what Tetra Pak is trying to provide; part of a
culture that flows through all levels and to each individual in the organization.
We've expressed it in what we call the People Idea and in our Core Values. In this
section we'll develop our thoughts on these matters.

32. Leadership

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 “It is the process of influencing a group toward the achievement of goals”

 Democratic Style

In Tetra Pak, democratic style is used for leadership because all the managers and
leaders involve every single person in decision-making and also encourage
participation in deciding the work activities, methods and goals.

Because in Tetra Pak they believe in giving their employees the combination of
freedom with accountability in their experience results it is the one of the best
solution. They want their employees to make the most of what they have got.
They also expect their employees to work in partnership with all other colleagues
in all parts of the company, focusing at all times on finding the best solutions.

33. Control Processes

“The process of monitoring activities to ensure that they are being

accomplished as planned and of correcting any significant deviations”

Tetra Pak is very conscious about their products, also they have very much
responsibility on overall organizations shoulder to meet customer requirements because
they are the only packaging company in Pakistan. So, they evaluate their overall
performance with actual standards that they were set in their planning phase, so to get
the complete idea, where they stand. So, they apply control processes in the form of:

 Feed Forward Control

Tetra Pak uses this control mechanism to overcome the threat of problems after
the product is in the market and also to prevent anticipated problems. They use
this through the use of timely and accurate information that often is difficult to
get. So, by using this method, they are able to cope with the problems earlier, so
they have no problem after the product is launched in the market.

 Concurrent Control

Tetra Pak sometimes also used Concurrent Control to overcome some of the
problems that may occur in unique situations like in the case of any mishap. In
this situation, they use this control to check the product when the activity is in
progress. In this way they also save the cost of correcting the errors after the
product is launched in the market.

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34. The BCG Matrix

balanced product portfolio

The amount of products in the portfolio of B2B organisations tends to be less than in B2C
organisations as business demand polarises around functional specialised products rather
than brands and brand extensions. Procter & Gambol will offer many different cleaning
products and brands for its different consumer segment needs based on emotional as well
as functional needs. On the other hand the need for industrial cleaning products will be
based almost solely on effectiveness at solving a practical problem and so the range of
products wanted will be less. It is still essential, however, that the range of products at all
stages in the portfolio match the needs of the target segments both at the present and into
the foreseeable future. What constitutes a balance product/service portfolio will vary
from industry to industry but the need to have new products on stream and coming
through the system as older products weary and decline along the product life cycle
should be self-evident.

The Boston Consultancy Group Matrix

(www.bcg.com)

The Boston Consultancy Group Matrix is a model that looks at the relationship between
market share and market growth. Products, product lines of SBUs ( a strategic n business
unit is a term used for anything from a product through to a company division or
subsidiary that is strategically important to the health of the organisation) are then plotted
on the matrix according to market share and market growth. As with most marketing

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models the value comes from the discussion that should take place when analysing
product position on the matrix and not as some kind of predictive tool. It forces staff
members to take time out to look at both the current state of both own product portfolio
mix compared with the mix of the competitiors. In fig. 6.1 the left vertical axis measures
the rate of market growth and the top horizontal axis measures the relative market share.
The rate of growth measure to be used will be any rate considered relevant by the
practitioners. In our example it will be seen that 5% and 10% market growth measures
are used. You will also see that there is a high and a low growth rate box.
The SBUs are designated by circles and the size of the circle will indicate the amount
that the product contributes to product portfolio overall company revenue.
The bottom horizontal axis measures market share in relationship to the nearest
competitor. A figure above I indicates market leadership and market share above the
nearest competitor, for example x5 = 5 time market share compared with the nearest
competitor. A figure less than I indicates non-market leadership and sales in relationship
to the market leader, for example x.o5 = 5% of sales compared with the market leader.
Again there is a high and a low box. (As with market share the figures used are relevant
and can be decided again by the marketing practitioners).
With all the products, product categories or SBUs plotted on the matrix grid an overall
pattern can be seen covering company products in terms of:
1 Whether a particular product (SBU) has a high or low market share
2 Whether the market for that product has a high or low market growth
3 The contribution that product makes to overall revenue
4 The position each product has in the market compared with the major competitor

BCG portfolio matrix revenue and cost indicator

The Matrix can also be used to indicate the organisation’s cost and cash flow position
where x = the level of revenue received. So sales of xxx and costs of xxx would indicate
high revenue and high cost of sales whilst sales of x and costs of xx would indicate low
sales revenue and higher cost of sales. These can be seen entered into each of the boxes.

BCG Matrix explained

Then process is circular moving from the top right hand square, the ‘problem child’ to the
top left hand square ‘the rising star’ and then downward to the square below ‘the cash
cow’ and finally to the bottom right hand square, the ‘dog’ mirroring the movement of
products through the product life cycle.

The problem child square – product A has a low market share in a growing market
and is at the bottom end of this market growth. . product B is doing better, being higher in
the segment. It is called a problem child (or question mark) because there is doubt about
the product’s ability to increase sales and move into the rising star box.

The rising star a square – A product located here will have a high market share in a
high growth market (hence rising star) . It can be seen that product C is better placed than
product D.

The cash cow square – Products here have a high market share in a low growth,

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 mature market. Again product E is better positioned than product F. Products here are
called ‘cash cows’ because cost are minimal because the products are well established,
there are economies of scale and learning curve advantages and revenue is high although
the market will begin to slow down. Cash cows should be used to support new product
development in the ‘problem child’.

Dog square – The dog square is characterised by low market share and low market
growth, and the future looks bleak, hence the adjective ‘dog’. The market is in decline
and it can be seen that although G is in a better position than H both have low market
share. The choice is to either liquid the product or, if possible, to re-launch and reposition
through the ‘problem child square and set the whole process in motion again.

A balance portfolio
Ideally a company would maintain a balanced portfolio of products. In theory, if the
company had 100 products there would be 25 in each square with a continuous anti-
clockwise movement of products, new products coming through the ‘problem child
square’ generated by contributions from ‘cash cows’ and old products would be declining
and disappearing through the ‘dog square’. In practice the number of products in each
square will depend on both the type of product and the demands of the industry. In some
industries more products would need to be in the problem child square than in others.
This might because of the long lead-time taken in research and development, for example
pharmaceutical products that can take 10-20 years coming to market or because
customers demand a continuous supply of new products, for example in hi-tech industry.

A simple diagram of a B2B balance portfolio

Product growth
High Low
High 25 25
Rising star Problem
child
Market share
25 25
Low Cash cow Dog

34. Bibliography

 Faiza Maqbool
Organizational Development Executive at Tetra Pak Pakistan Ltd.

 Javeria Khan
Human Resource Executive at Tetra Pak Pakistan Ltd.

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  www.tetrapak.com

Conclusion:

Today, Tetra Pak it is the only international company in the world able to provide
integrated processing, packaging, and distribution line and plant solutions for food
manufacturing.

This means that Tetra Pak's customers enjoy the advantage of being able to get multi-
product solutions from a single source, with matching equipment at every stage.

Products

Tetra Pak supplies complete systems for processing,

packaging and distribution. Tetra Pak processing and
packaging systems make economical use of resources.
The processing systems are developed to treat the
products gently, and consumption of raw materials and
energy is minimal during the manufacture and distribution of packages.

Tetra Pak packages fulfil the main purposes of packaging, namely to:

 maintain product quality

 minimise waste

 reduce distribution costs

Packaging

Tetra Pak can offer packaging machines for a wide range of packaging alternatives. The
company produces packaging machines as well as packaging material.

Processing

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Tetra Pak supplies complete processing and packaging lines, and takes total responsibility
for the equipment supplied. Processing equipment includes separators, heat exchangers,
homogenizes and evaporators, as well as equipment for aseptic processing and flow.

Distribution

A large number of different types of distribution equipment, such as conveyors, tray

packers, film wrappers, crates and roll containers are developed, produced and marketed
by Tetra Pak.

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